Talk about your Business Model

 

While engaged in business negotiation you need to explain about your business model at some stage. Therefore, it is necessary that you must have sound knowledge of your business model, and how it follows through. Check out for the main components of a business model and bring this into your business ASAP

Business Model

Started as a buzz word during the dotcom days, business model has to come to stay as a powerful tool in business negotiation where parties thrash out how they can work together in a particular deal. Investopedia defines business Model as “The plan implemented by a company to generate revenue and make a profit from operations. The model includes the components and functions of the business, as well as the revenues it generates and the expenses it incurs”. A sound Business model can take your business to the top range whereas a poorly made one spells doom. Let me give you ten components of Business Model for you to adopt instantly:

1. Identify/Create Market Need: Look at the market place; there may be a specific need that remains un-fulfilled; or may be that the current supply of products does not give optimum results. Conversely, you can create a need that does not already exist but could offer more convenience. Computer based telephony was a created need that did not exist previously

2. Design Product to satisfy this Need: Second component relates to how you satisfy the need that you have already identified or created. This involves lot of thinking, technology, engineering skills and stipulating parameters of quality and technical specifications. Excellent features of the product, its un-failing quality, convenience it offers and finally its capacity to integrate seamlessly with existing systems are some of the concerns need to be addressed. The outcome is Voice over Internet Protocol (VOIP) that was found to satisfy the need for computer based telephony

3. Introduce Product to Market: Third component has everything to with what the market bears. Your business model must involve activities covering release of the product as test marketing or as a beta version to be improved later on. The depth of market along with its willingness to accept & adopt your product is a key criterion in-built in your model. If ever failure occurs the business model must provide honourable retreat or withdrawing and introducing it with modifications later. If the outcome is indeed successful you have to begin a marketing campaign aggressively

4. Price & Discounting: Your business model must take extra caution in this area. You can either choose to come up with a lower price for basic product and higher price scales applicable for use of advanced features or you can introduce at a market skimming price so that you can evade competition in the short – run. Your business model must also address the concept of discounting price scheme for bulk purchases, wholesalers, business partners or buyers under agency arrangements

5. Selling & Commission: Fifth component is how to set up sales and how much you are willing to share as commissions with dealers and business partners. In most business models these re- sellers, business partners, dealers and agents who get double benefits. One under price and the other under sales; the latter is referred to simply as commission and written-off in the trade invoice or paid separately

6. Delivery & Stand-by: Though it is the sixth component in our discussion, it is the most critical one that can damage relationship with re-sellers or direct buyers. Time, mode, quantity and delivery schedule are matters that cannot be pre-determined in any business. Nonetheless, it must be brought in as a standard element when product is sold. I do not suggest any uniform delivery mode as none exist in today’s context. What your business model must provide is the optimum manner in which you will handle delivery. Stand-by procedures often follow the delivery schedule and must come into force as and when you detect snags in delivery

7. After-Sales: The seventh component is after-sales; your business model must stipulate after-sales terms covering replacement, repair and product warranty. The best example of after sales is when you buy a Toshiba laptop; the guys will give a stand-by laptop for your use in case of break-down till they repair it or simply give you a new replacement. I am yet to see this type of after-sales from other laptop vendors

8. Review: You must build the component of review in the business model so that after successful conclusion of a business transaction and frequently thereafter you continue to review the sale by being in touch with the re-seller or direct buyer

9. Flexibility: The ninth compartment is to bring some degree of flexibility into your business model; all the above eight components are flexible and not rigid as sacrosanct. When the need arises you must be able to tweak your components quickly and get the operations going. You are not the one who should bicker acrimoniously on price and sales terms when a big deal is in the offing. By the same token you will not throw away time tested business model for the sake of a single non-repetitive deal

10. Cosmic Balance: The final component has got to with your own cosmics; cosmics are aspects that are beyond facts & figures but still influence the conduct of your business and the formulation of your business model. Your business model, therefore, must bring cosmic balance so that you make better sales and generate more revenue and at the same time make good profit and keep your buyers glued to you forever.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Finance for the Holiday Season

 

Holiday season is round the corner. Christmas comes but once a year; when it comes it brings the season of cheer. Your finance constraints should not stand between you and your enjoying the holidays. Here are few tips for you to follow through:

1. First and foremost decide where you are going to be during this season; be with the family at home or take them to a faraway land by the beach or under the shadow of peach trees

2. Assess how much is the budget for this round of holidays. Once you have worked out a figure find out how much you can marshal from your own source and how much is left to be topped-up

3. Now you must find out how to fill the shortfall; at this juncture two issues come to the fore. One relates to your personal status and the other relates to your finance sources

4. Check your personal status: you can be a business person; fully-employed in a company; part-time employee somewhere; or self-employed

5. Check your credit status: if you have excellent or good credit score then it sounds fine; any average or poor score is still redeemable. If you have bad or miserable credit score your chance of getting finance is dim

6. Now check your sources of finance spanning in consumer divisions of major banks, credit unions, building societies or savings and loans associations

7. Either choose temporary enhancement of your credit card limit to tie over the holiday season or go for a personal loan to finance holiday season

8. If you choose credit card enhancement negotiate with the banks on the amount you require, their willingness to extend the period of payment, the relaxation of minimum payment for the season without incurring any interest over-charge

9. If you tick personal loan you have to do much more ground work. The lender would look at your credit status, past performance and affordability before making a commitment. Furthermore, they would also look at the terms and conditions to decide upon the rate of interest that is charged for this personal loan. Primarily, the period of repayment matters. Depending on the market movement short and long term lending is priced lower or higher. If you tie for a long period say five years it will be tagged to bond market rate and interest will be charged accordingly. If you are eying a short term say one year loan then the rate would correspond to money market rates and interest will be charged accordingly. Interest rate you pay is also governed by the fact whether your loan is secured over collateral or remains un-secured. There is another side of the coin: you can also book in for fixed or floating interest rates

10. Before signing on the dotted line do a search to find out personal loan terms and conditions from at-least 3 sources and do what we call as “comparative terms”. You must also get the precise amount the lender would charge as commitment or engagement fees

11. It is advisable that you clear out the option of early payment with the lender. Generally, personal loan is granted for a fixed term of X number of years. In case you wish to make a lump sum payment during the pendency of the loan, the lender is not amused. This is because he has to find ways to park the excess funds. Ordinarily, lenders insert a clause that such early payment attracts a penalty. When you go for a personal loan negotiate for the removal of this penalty clause

Even though you are borrowing to enjoy your season of merry be rest assured that it comes with a big plus point. You are relaxed; more than that your cosmics are fine-tuned. Cosmics are aspects residing within you shaping and influencing you and your business or career though these are un-seen and un-noticed by you. After giving a chance for your cosmics to work you return to your office desk as a new-born guy with zest and zing.

Season’s Greetings

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Seven Strategic Risks facing Business

 

Business faces some kind of risk in normal course and that is inevitable. What is important is to identify and understand which risk turns out to be a strategic one. Normally such risks arise due to a failure of one or more of your strategy in seven areas. Let me elaborate seven strategic risks facing business:

1. Reputation: This strategic risk is the most critical. Your reputation is your business. If it is damaged your business will never recover. You must ensure that the name of your company, its processes, its products and its image remain always above censure. Recently a Chinese milk powder company went out of business when its products were found to contain chemicals injurious to human life. When this happens business must take every effort to neutralize bad press, news or propaganda while at the same time making amends to the damages already done

2. Regulatory: In the case of risk of reputation business has control over what it can do about it; in regulatory risk business faces situations beyond its control. As a strategic risk regulatory aspects can be debilitating. Recently, Blackberry a mobile and smart phone device sold by Canadian company Research in Motion (RIM) has to face spate of restrictive regulations in several countries. Effective negotiations, compliance with regulations along with ensuring that such regulatory rules do not recur are few of the risk control measures recommended

3. Technology: If you are in IT you know that technology is changing hour by hour. Today technology is the main strategic risk for businesses in internet and communications. Look at how Microsoft was losing its internet search engine market. Google’s adoption of Android Operating System gives endless hours of worry to search engine Bing. Updating and bringing still better technology are measures to neutralize this strategic risk

4. Marketing: Strategic risk in marketing has time limitation. When a business introduces novel marketing strategy it will have upper hand for some time. By and by its competitors would also introduce similar strategies bringing the score to even. Sticking to a single marketing strategy for promoting your products is therefore not possible. Look at the cola war that continues between giants Coca Cola and Pepsi Cola. Both are engaged in aggressive marketing campaigns including targeted advertisements against each other and heightened marketing strategies adopted to secure advantages. The one who blinks will be eliminated. So the war continues forever

5. Finance: This is a strategic risk that affects every business small, medium and large. Small business has more potency to be destroyed by finance risks than its counterparts in medium and large scale operations. Strategic finance risk arises in many areas and stretch from weak capitalization to creation of financial instruments to manage exposure to risk. Businesses that borrowed large quantum of money by issuing exotic instruments are in for trouble now. They have brought down along with them the lenders, creditors and even governments. Look at what is happening in the Euro Zone

6. Key Person: Insurance companies are smart; they brought the key person insurance pretty long time ago. Business faces this strategic risk when a prominent leader or manager leaves office. High profiled companies assign head-hunters to get their choice of key persons tumbling the companies where these persons previously worked. Though this strategic loss affects companies across the board, the worst mauled are in those in the field of technology, food , travel and tourism. Business must apply several measures to neutralize if not eliminate this strategic threat

7. Cosmic Risk: Cosmics as a risk factor is something new. Cosmics are aspects residing in every person and as an extension in every business. Cosmics can arise in different ways. You have to understand cosmics and turn it to your advantages. Ignoring cosmics can lead to failure. An interesting example is the James Bond film series. Albert R Broccoli produced 16 films in the James Bond series where he portrayed Bond as a male chauvinistic spy. After his death in 1996, his successors diluted this concept and today the appeal of the Bond as a ravisher tinged with magnetic personality has evaporated.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Should Business Idea must be original to Succeed?

 

When you speak to someone about your business idea the first question that pops up is whether it is an original one. So business persons are more concerned with innovation and make their business ideas sound original. But they have not looked at the performance angle. Should every business idea must be original to succeed in the market place. Let us find out.

Your business ideas are sparks of your studied imagination. You get a bright idea in your mind based on your experience and learning and from what you read and reflect upon about how others have gone through. I just looked at the Fortune December 12, 2011 issue and read about the list of 50 Movers and Shakers profiled there. Afterwards, I superimposed the originality or otherwise of the business idea represented by four of those movers and shakers. My findings are as follows:

Original Indeed: Mark Zuckerberg Co-founder and CEO of Facebook ranks as a businessman who brought the original platform on social networking in style and relevance. Leader of the social media, Mark founded Facebook in 2004 and today its sales top 4.3 Billion U S Dollars. The present valuation of the privately held share capital is between 79 to 82 Billion U S Dollars. The financial market awaits the initial public issue of the Facebook expected to open in early next year hovering around 100 Billion U S Dollars. This is remarkable success of an original business idea

Improvement: Larry Page Co-founder and CEO of Google went on to improve the business idea of internet search engine in competition with Microsoft. He improved the technology of search engine by introducing innovative platforms such as Android Operating System and implemented it seamlessly across various products offered by Google. From Android it was easy to get into telephony and the hand set market. Just look at Samsung Galaxy Tab 10.1 and you will realize how effective Google as search engine is. It is giving strong competition to Facebook in social media by introducing Google+ which has more than 40 million users right now. Revenue for 2011 expected to touch about 40 Billion U S Dollars

Adaptation: Hamdi Ulukaya Founder and CEO of Chobani is dubbed as the King of Greek Yogurt. There is no such thing as Greek Yogurt or Armenian yogurt. What Hamdi did was to adapt the business idea of yogurt in pleasing flavours including vanilla, strawberry, peach, blueberry and honey and mixed with pomegranates and other fruits. He then presented Greek yogurt to the American market obsessed with Greek yogurt and crazy over health food. Founded in 2005, Chobani is now ranked as third largest yogurt company with sales targeted around 700 U S Dollars in 2011. Its market share in Greek Yogurt is almost 50 % while in the overall industry Chobani has about 10.4 % market presence

Re-Make: Robin Li Co-founder and CEO of Baidu is a classic example of a shaker who just did a re-make of an internet search engine in the fast growing Chinese market. Robin saw an opportunity of re-making the business idea when Google made a graceful exit from Chinese market. Modelling on Google, Robin has everything that Google did or offered. He integrated with Android Operating System and expanded his web portfolio to include search, on-line business and auction based marketing methods. Baidu is now controlling 75 % of the internet market in China

Cosmics: All four business persons profiled above took their business idea and fashioned it differently. But the binding thread that runs across them is the way their cosmics helped them succeed in their chosen ventures. It is because cosmics make each businessman succeed in a particular field or sector. Cosmics are aspects residing within everyone shaping and influencing his idea and business. 

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Put Your Personal Finance in Order

 

Today we observe that many a business person mixes business finance with personal finance. This trend is too acute in the case of small business where the line dividing business and the owner is much blurred. This has caused so much of troubles lately that every business person must be coerced to put his personal finance in order before doing anything else.

Streamlining your personal finance dictates that you tick off each and every instruction below as right and doable:

1. Legislate in your business model that you will never ever draw more than one-third of the profit or forecast-profit of the business. Now is the bitter part: learn to live within this ceiling

2. Once in a way you would have over-stretched your personal finance; that is excusable but do not make this as a habit

3. When there is indeed some over-stretching and your manoeuvrability is limited you must work consistently to improve the situation. Hoping for an Aladdin’s Lamp to solve your financial worries is meaningless. Of course, you are justified in having the thought that the situation might improve over a period of time; but if you are not going to act promptly the situation might even get worsen. A classic example is what is happening in Greece. The Greeks have jacked up public expenditure; borrowed more money to finance it; they do not want to tighten their belts; now they want the rest of the world to give them some more money

4. Never get into arrears in utility payments such as electricity, gas, water, telephone and mobile s as these bills add to your finance woes

5. Learn one wisdom: Credit card due is a treble-edged sword; if you do not make the minimum payment there is a plenty; even if you make a minimum amount due still the banks charge you interest on the whole amount including the amount you have paid in; if you make further purchases that amount is also added to your burden and payable in the next cycle. Therefore, either you pay the entire amount due well before the due date or never use the credit card at all

6. Contrary to many financial gurus, I hold the opinion that you must pay your bills manually rather than electronically. It is because you never know the amount you are paying till you get the bank statement. On the other hand you might be charged interest if by paying these bills your account gets overdrawn. A systematic way of paying bills as these fall due must be initiated by you rather than you allowing some machines to handle this on auto mode

7. Never lend your money to your friends or members in your family circles as the chances of getting it back is slim during recession

8. You must streamline your purchases for home and personal needs. Shopping must be done either weekly or fortnightly basis in a planned manner. This rule may not apply to urgent or daily purchases. Drive away the feeling of swiping your credit or debit card at supermarkets at your whim and fancy

9. Your business makes profits; such profit must be allocated in three ways; one part be invested within business; one part be invested outside business and the remaining part goes as your drawings. In this scheme the second one is very important. You must invest about one-third of your business profit elsewhere so that you will be able to get some return when you really need it.

10. Always save for the rainy day; keep some spare cash stuck away somewhere in a bank, bank locker or in some corner in the house

11. Examine your cosmics for guidance and inspirations. Cosmics are aspects that are beyond facts & figures but still influence the conduct of your business and your personal finance; cosmics reside in every individual and by extension in every business. A business person who understands his cosmics can plan out his personal finance by culling the fringes of his spending patterns. Moreover, he can focus on keeping a tight and right balance over income, savings and expenses.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Making Money in Microenterprise

 

Economy is too stupid; finance in doghouse; most families are struggling to make ends meet; gloom all over; some 45 Million Americans have slipped into poverty; recession is not abating. Endless media outbursts on state of economy paint a picture of gloom. But there is light at the end of the tunnel: despite all these concerns you can still make money by moving into a microenterprise. Here are details:

Do a quick Test:

If you are in one of the following situations, you are the suitable candidate to start a microenterprise:

1. You are unemployed or under-employed, the latter means you are not in a full time job or working below your level of qualifications

2. You are a housewife having spare time but without any individual earnings

3. You are an immigrant

4. You are member of minority community lacking social mobility

5. You have individual talent and creativity but lack economic opportunity

6. You are unable to budget as income is less and expenses have spiralled

7. You have no collateral to approach mainline banks for finance

8. Finally, you are in one of the growing pools of people who have slipped below the poverty line

What is Microenterprise?

A microenterprise is the smaller version of a small business; hope you do not get confused by my using the word small twice. It is simply a low scale business that you can start with least amount of capital and without many assets. While Government administrators do not specify any minimum capital, asset or employee levels for microenterprise they have come up with some kind of ceiling where microenterprise gets elevated to small business. The most recurring ceiling comprises the following:

1. Maximum 10 employees

2. Maximum capital about 50,000 U S Dollars

3. Maximum Assets about One Million U S Dollars

The concept of microenterprise was originally founded by Dr. Mohammed Yunus, a Bangladesh Social Reformer in 1976 and accepted by the U S Small Business Administration as a distinct type of business in 1991. Association of Enterprise Opportunity (AEO) of USA is promoting the concept in America hard resulting in more than 2 million such microenterprises operating successfully.

Distinct Advantages

Microenterprise gives results in quicker time compared to other business types. Some of the key benefits that arise are:

1. Creating jobs opportunities to you and others much faster

2. Jacks up your income earning capacity in short time

3. Takes out your financial worries immediately

4. Gives you a social status as a business person with least amount of capital

5. You are back in form with the purchasing power that eluded you for sometime

6. You are engaged in something, which itself is a relief for you

7. You provide goods and service in improving convenience of your locality

8. Your output is priced competitively as the cost of producing it is much smaller compared to other types of business

Where you can Pitch

You can pitch in any sector where there is opportunity for you to use your talents and turn out goods or services that are pretty saleable. I am suggesting few areas in the following list, which however is not exhaustive:

1. Boutiques or corner shops

2. Home-based kiosks

3. Skilled operations such as carpentry, plumbing, welding etc..

4. Specialized farming of grains or exotic fruits

5. Craftsmanship that can be provided in a localized set-ups, such as garages, picture framings, etc..

6. Creative products including painting, music, dancing and entertainment

7. Providing management services such as event management, security, maintenance and others

Caveat

Before embarking on a microenterprise you must pause for a while and think whether you have a key driving force in you. That is your cosmics. You know that, cosmics are aspects residing within you shaping and influencing your business throughout. If you are not going to evaluate your cosmics and find the suitable microbusiness for you, your chance of making it a success is doubtful or call it micro.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How to Package your Personal Branding?

 

Many a successful business is built around a single person who is either its owner or founder. This person endows his personality to the business thereafter he, his personality and the business are identified together. As time goes on his personality transforms as the brand for his business. When this happens we have an identity known as personal branding. For the success of a small business as well as larger ones personal branding is a definite must. Let me un-wrap a personal branding package for you:

Personal Branding Explained: The concept of personal branding was originally introduced in 1937 by Napoleon Hill in his book “Think and Grow Rich”. Later Tom Peters developed the concept as part of corporate culture in his book “In Search of Excellence”. Today personal branding as a distinct identity is popularised by many personal branding gurus, chief amongst them is Dan Schawbel, whose writings have been quoted extensively in business literature.

Personal branding is basically packaging your unique personal features into a consolidated brand. This branding then turns out to be a valuable asset in your repertoire. At the zenith, your business and your personal branding are as inseparable as Siamese twin. There is a risk of your indispensability though. Once you have retired from the business the personal branding you have developed could boomerang on your business, unless your successors too could be cultured in similar manner. Here is your personal branding package:

1. Shaping your Body: You can be tall, of medium height or short person. Whatever your height is you should keep your body in good shape to garner instant attention. You are aware most people get impressions on the first sight which is difficult to erase later on. Therefore, you have to morph your body to make you a smart and pleasing person. A big tummy has two negatives: it can cause health issues and it can kill your business chances too

2. Distinct Clothes: I am not suggesting that you should have Armani collections and Versace accessories in your wardrobe. But whatever you wear it must fit your personality and you must stick to that. You must do what we call as power dressing. It can be simple or fastidious; but keep it in your mind that you are half and the better half is not your wife but your dress

3. Shining Face: You know face is the part of human body that is watched more than any others. An adage goes thus: face in the index of mind. Of course there are different face structures; round, oblong, thin and plumb and so on. What matters is not the shape of the face but how it brightens you up. You would have seen men and women whose faces made remarkable impressions in your mind. It was a pleasure to look at them and you still remember how those faces were shining and how you were galvanized by that pleasant smile

4. Winning Attitude: When you speak or move, it is the attitude that comes out. Your uniqueness in terms of body, clothes and face convey in a single word about you and your attitude. Without a winning attitude none of the above can deliver the goods. Attitude is always based on the belief system you have about you, your business and the person with whom you inter-act. Great men are always born with winning attitude; successful men develop it. Therefore model yourself with those who have succeeded in business with positive attitude. Steve Job is an excellent example

5. Broad Knowledge: There is no requirements as such that you should get “A” grades in your subjects while in college; but gaining broad knowledge is indeed is compulsory. When you speak you must flaunt that knowledge not to impress others but to bring them onto your side; make them see your point of view; get them to think like how you think; that is personal branding in a nutshell

6. Fitting Conduct: All the above ingredients can be thrown over-board if you are lacking in appropriate conduct. You have got to play by the ear; rise to the occasion; conduct yourself in exemplary manner. You can be harsh sometimes but well meaning; you have to be guided by ethics and logic while inter-acting with staff and customers. Never allow your emotions to take charge and fly into rage. Even if that happens you must have the courage to say sorry and make up quickly. You must show dignity and decorum befitting every situation you are in, in a manner that makes you a loved person more than a feared one

7. Leveraging Cosmics: You have hidden resources which we call cosmics; aspects that are residing within you shaping and influencing your business throughout; you must understand your cosmics and leverage it in your business life. A good example is the charming smile that you have accompanied with the soothing manner in which you speak to people. You can leverage this cosmics in negotiating and closing business deals at ease

Once you have these seven aspects you are well in the way to have your own personal branding.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How Business can get out of Debt Trap?

 

Debt trap is now strewn all over business enterprises. Small businesses, large ones and even multi nationals have unwittingly got into the debt trap, modern day version of apocalypse. Debt trap occurs when a business gets into a vicious circle where it borrows more money to pay up the debt already owed. Finally the burden of debt brings in disastrous results for the business, society and for the economy. So how business can avoid disaster and get out of debt trap. Here are few suggestions:

1. Contact the banker/financier for working out the current loans. Work out is a method where banks acting on their own re-schedule loans and offer concessions regarding interest payments, declare moratorium over whole or part of the accumulated interest and grant flexible terms on amount and timing of instalments due

2. Go for re-structuring of the current debt on your own. This method is different from the first one as you will be taking initiatives in managing debt and submit your proposal for negotiating the terms of the current debt. Of course, such re-structuring must have the approval of the banker/financier

3. Replace expensive finance with cheap finance. In most cases business, particularly small business tends to borrow more when the interest rates are fairly high. Interest rates generally move up and down depending on the state of economic growth. During high economic growth interest rate also hovers in high zones. Business, encouraged by positive atmosphere prevailing in the economy blindly ties up with debt at expensive rates. When economy moves into recession interest rate falls into low levels. Therefore during recession small businesses must make an effort in replacing loans booked at high rates with cheap alternatives

4. Talk to your creditors who have supplied materials for business operations. You can ask them for an extended time period to pay out the amount owing. In the case of expense creditors, generally this concession is not available. For example, electricity companies do not negotiate on arrears and tend to cut supply lines. You also have a tall order in negotiating with statutory creditors such as Revenue Department

5. Reduce operational cost as much as possible. I am afraid you cannot do this overnight. But if you put an effort you can cut corners in operational cost without much harm being done to your production line

6. Dispose fixed assets that are no longer wanted. Many business enterprises dump huge amount of finance buying up assets without doing a proper evaluation as regards to their usefulness; added to this, business generally does not bother about re-sale value of fixed assets at the time of acquisition. Hence, you have a double whammy: on one side the economic value of the assets in the current scenario is less and if disposed it could fetch much less than the original cost of purchase. You have to take hard decision and sell at some prices even though you have to take loss eventually

7. Budgeting is your weapon of mass protection; you should put in operation budgeting with a short term roll-over. I suggest that the budget exercise is rolled over every month till such time you are out of the debt trap. You must budget both the income as well as expenses on equal keel. You have to put extra effort in increasing sales revenue and pitch on chasing receivables to get the cash flow in

8. Finally let cosmics be your pull and push factor. Cosmics are aspects residing in every person and as an extension in every business. Cosmics can function as pull factor when you go for negotiation with your banker/lender or that particular customer who is promising you a big order. Cosmics play the push factor when you are impelled to change your business outlook, make a face –lift, bring in courage and confidence to weather the storm and at last succeed in getting out of the debt trap.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How to Control Capital Expenditure in Business

 

Today large amount of finance is tied down as capital expenditure in business enterprises. The percentage of capital expenditure is huge in utility industries like oil and gas for valid reasons. Elsewhere in service industry and small business enterprises there is a rising trend in capital expenditure without justification. Let me give you do and don’t on how to control capital expenditure in business:

What is Capital Expenditure?

Before charting a road map of do and don’t in capital expenditure, let us first find out what exactly fits the term capital expenditure which is often shortened as Capex. Any purchase & improvement of land, purchase & construction of buildings, purchase and installation of plant & machinery, tools & equipments, furniture & fittings come under the definition of Capex. These assets are classified as fixed assets in finance. After the initial phase of acquisition, fixed assets are to be maintained; this results in revenue expenditure. When it is necessary fixed assets are to be overhauled; this results in Capex once again. There are similar words used in business meaning overhaul: improvements, upgrades, refurbishing, extension, and face-lift are some of the most common.

 

Do List

1. Undertake Capex where the useful and economic life of the underlying fixed assets can be extended. Assume you have a plant and it is almost worn-out; if you can extend its usefulness might as well spend money to do so rather than buying a new one

2. When you experience rise in your scale of business operations you should sanction relevant Capex

3. If there is an industry wide use of a particular fixed asset that you do not possess then it is better you approve Capex. A good example is the acquisition of state-of-art technology in media and communication

4. When your competitor acquires a specific asset that can tip the scale in his favour in terms of sales and operations then it is advisable you do Capex urgently

5. If you have a drawn-out Capex plan to be rolled over a number of years, you must undertake relevant expenditure even though such Capex is not urgent. A good example is re-furbishing done in tourist hotels and cabanas. Often this type of expenditure is known as planned capital expenditure

6. Replacement of fixed assets could also be necessitated by events where the business has no control. An example is loss of fixed assets caused by fire, theft or natural disaster

7. Go for Capex where the assets you intend to acquire would generate cosmic energy which in turn can be translated into enhancement of business image, improvement of staff morale and finally growth in business prospects. This we call cosmics. As you are aware cosmics are present in everything you do including your business

 

Don’t List

1. Never approve Capex where you are adding fixed assets that cannot be used in near future; this superfluous acquisition can be seen in many businesses that fail within a short period of their opening

2. Any wasteful Capex must be avoided absolutely. Most small business enterprises get into this situation because they do not evaluate the purchase decision carefully. More than that they do not plan out the purchase of fixed assets in advance

3. Never acquire un-productive assets; once again this is one of the main causes in failure of small business. An ostensible example is the construction of parapet wall and other security paraphernalia that are not meant to aid in production and operations

4. Do not be overly carried away by value of aesthetics in business; it is acceptable that you should beautify your environ in the business place. But always look at the trade-off between utility and aesthetics

5. No Capex if that only serves only your ego. Grandstanding is good in politics but never in business. If you are egoistic, you will squander your finance, let go of your business opportunities and finally compromise your future.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

In Business, do the Right thing Right

 

Most businesses in United States and Europe are not doing the right thing right compared to their Chinese counterparts. Let us see where these businesses are heading to:

1. Do the Wrong thing Wrong: Thousands of businesses mainly in the small business sector in United States and Europe are getting into corner by doing wrong things in wrong manner. Examples  galore. Let me give three areas of disaster:

1.1 In Finance businesses have ramped up debt equity leverage into un-sustainable zone; at very high interest rate to foot. During recession businesses cannot service the debt and about 75 % of them are in some stage of receivership

1.2 In – house management of operating cost is in shambles, causing break-even point to go up. As sales starts to dip a business is unable to cope up with the current cost level

1.3 Meeting delivery schedule has become a haranguing experience. Most small businesses cannot stick to the order schedules and are facing the un-palatable situation of losing buyers

2. Do the Wrong thing Right: This trend is catching up in several businesses in the North Atlantic region. These businesses are doing the wrong thing; but there is a saving grace: they do it in right manner. Shifting production location is one of the key pointers. For various reasons these businesses have shifted major part of their operations outside the region and have gone into countries like Turkey. On the one hand they have deprived their nationals employment opportunities, and on the other they have chosen well as Turkey is now being added to BRIC list of fast developing industrial giants

3. Do the Right thing Wrong: This is somewhat better than the above two modalities; we find many small businesses tend to do the right thing albeit in wrong manner. Consequently the expected results are disappointing. Good example is the investment made in undertaking ingenuous research in the fields of bio-technology and food processing. But before the businesses could put these into operationalization and garner new business opportunities, the research methodology or process gets leaked into hands of industrialists far away from North Atlantic region. The beneficiaries on the other side employ the methodology/process and mass produce products even at cheap prices. All the fuss about copyright, patents and WTO regulations just disappears like smithereens

4. Do the Right thing Right: At present, I see businesses in BRIC countries get well-versed in doing the right thing right. No wonder the tip of balance is slanting in their favour. A good example is how business houses in these countries are churning out consumer items in cheap prices and slowly edging upwards to the manufacture of capital goods as well. These businesses evaluate not only their economic assets but understand and use their cosmic energy in order to raise their operational level up. Surely, cosmics have given them that extra push that made today’s China a giant in industry and commerce. Unless businesses in United States and Europe are alive to this situation North Atlantic region would fast become an importers’ heaven.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Who can Evaluate Your Business Idea?

 

You have a got a business idea. You think that it is really great. Having mulled it over, you feel that it can be translated into commercial success. All the while, it is you and your idea that mattered. Now comes the third party angle. You have to find someone to look at your business idea and evaluate it for you. Here are persons whom you should approach:

 

1. Charity begins at home so does evaluation of your business idea. Firstly, you sound your family about it. Your wife is an important resource person who, knowing you very well, can give an informal assessment. She may not be a business person but she possesses insight into how you work and what will work for you. Next you should turn to your children who are adults and can understand many things in proper perspective than you. The reason is that you are emotionally attached to the business idea you have developed whereas they can bring a rational approach to bear upon it. When discussing within family never load them with facts and figures. Just explain them broad principles and major matters

2. Secondly, you must talk few of your relations over. You can choose to speak to one who has succeeded in business or career. Additionally, you must also have a rendezvous with a relation who is more of academic bent. This way you can mesh academia with practical life; a method often brings you a via-media approach. During this discussion you should wait till they finish and pose them questions, taking the stand that your business has definite fault lines. Why do I say this; if you profess loyalty and possessiveness towards the idea, your relations would often be silent and would not venture making any adverse comments

3. Next in your appointment schedule are close friends who could come from different backgrounds: in business, career, academia, government service, military, social service and so on. When you meet them you explain your business idea and give the pros and cons and await their own appraisal and analysis. You should ask searching questions that include benefit and cost; risk and reward, limitations and growth etc. As you proceed ask them to look at your idea from neutral ground and prod them to give you more qualitative comments

4. Then comes the professionals; you must approach accountant, company secretary, lawyer to give their feedback on your business idea. Once again you must adopt the approach I gave you in dealing with your family members. Give them facts and figures as well as broad principles and major matters surrounding the business idea

5. In the next segment you elect to choose either your banker or venture capitalist for an informal chat. These guys are well versed in seeing, reading and evaluating great number of business proposals and would be a big source not only in critically examining the idea but proffering advice and assistance in translating it into commercial success

6. Finally, you must get someone who can understand you, your business idea and your cosmics. However much bright and usefulness your business idea is, its successful transformation depends on how you understand and evaluate your cosmics. Cosmics are aspects residing within you shaping and influencing your business though these are un-seen and un-noticed by you. If you know cosmics well, you can employ these to your own advantages. For example, let us assume that your cosmics support you in food processing industry and your business idea is on data processing industry. So your success in transforming your business idea stands alone without any support from cosmics within you. No wonder why so many bright business ideas falter in the market.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

How Your Bank Responds to Your Proposal ?

 

So you have an appointment to meet up with your banker tomorrow regarding a proposal you have sent him lately. You are wondering what kind of response the banker would give. There are for ways in which your bank responds to your proposal. Here are the responses:

1. YES: This is the one you are dreaming about, a big positive nod from the bank manager with a thundering yes. If you are one of the lucky guys whose dreams come true very often you can bank on this response as the most feasible one. Then there are businessmen, quite a number of them running small businesses that have the kind of cosmics supporting them tend to get a yes answer. Whatever the manner in which a proposal is made, you should have necessary requirements to get a yes from a banker. Some are related to your finance, some are personal some are aspects no one can explain about. The last one intrigues you always. You would have had this experience when you saw the most qualified is not the one who gets the job. This is what we call cosmics, aspects that are residing within you shaping and influencing your business throughout

2. Yes, But: Unlike the previous response, “Yes but “, is not very stronger. Nevertheless, still it is the green light. Bankers tend to give this answer where they feel a bit of itch or snag. They have some concerns and they will drop these one by one like bombs falling during war time. During the discussion banker would dwell upon the easiest thing they can corral; that is collateral. Once you elaborate the type of collateral you are furnishing him then he would jump to the next C factor: cash-flow. Once again you will be at pains to explain him how you can tweak cash-flow to suit to his requirements in terms of debt- servicing. From here onwards the trajectory to get a yes is not so steep. You can get around his “But” to be dropped, provided you handle the situation well with facts and figures. Of course, your C-factors, that is, capital, cash-flow and cosmics all should work harmoniously

3. No, Yet: On the face of it, “No, yet” response appears to be a negative one. It is not so. A banker tends to give this response where he cannot say an outright no. There are reasons for this not so negative response. He fears that you might leave him or he knows that he financed similar proposal that is not doing well or he feels that if you are genuine about what you are asking for you can modify your proposal. When this response is made do not despair but use the window of opportunity to explain about your commitment to stick with the proposal as amended mutually between you and the banker. You must assure him that if there is a case of any previous failure the bank should not apply blanket treatment to your proposal. You have to convince him that you are able to address all his concerns. From this “No yet“, answer you must get double promotion to a strong yes. If this is not happening then you are to be blamed because you have failed to understand how your cosmics work to your advancement. A simple example is that you went to the bank in casual dress rather than in formal manner

4. No: This is the one you dreaded most and you have it now. Poor soul. What can you do? Fly in rage and blame the banker for economic recession; blame your accountant for preparing figures that could not withstand tests by the banker; or blame yourself. This is not a defeat though. You can re-make the proposal to this banker or another. You can improve your business. You can change your outlook. You can understand and evaluate your cosmics to succeed next time.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Should Partnership Profit be Divided Equally among Partners?

Business partnership makes profits and such profits must be divided among partners in an equitable manner. Despite this moral rule most partnerships divide profits equally. But does this equal division of profit is equitable or justifiable? My analysis and recommendation is given below:

1. In a partnership business partners contribute in two ways: one is giving part of their money as capital; other is demonstrating interest in the business. However, there is no reason to expect that every partner will have the same level of interest. Some partners take active part while there are instances where you see a non-active sleeping partner. Let us assume a case where you and your spouse are partners; your spouse does not actively engaged in the business but minds the hearth and bed at home. Can you divide the business profit equally? Even if your wife has contributed equal amount of capital it is not possible businesswise to divide profits equally

2. There are instances where partners contribute different amount of capital to begin with. In this case nobody can insist that partnership profits must be divided equally.

3. Partners open two accounts in the books; one relates to the capital and other one is an operating/current account. Normally capital account is fixed. At the time of appropriation salaries or commission payable to partners are credited to the operating/current account. Even though partners contributed, let us say, equal amount of capital the current account balance may vary from partner to partner. Some partners withdraw money and others leave it intact. A partner who has left more money in this current account, contributes indirectly to the capital funds of the partnership. Therefore, it is not morally right to divide profits equally. My argument is that both capital and current account must be augmented to arrive at a consolidated amount and profits should be shared in the proportion of the present capital funds available rather than on the original capital contributed. Alternatively, the capital account must be made fluctuating and the partners must be given a right to transfer any surplus available in the current account to this fluctuating capital account. Thereafter, profits must be shared in the proportion of the fluctuating capital account balances

4. Yet another issue is about compensation payable to partners. In many partnerships, this factor is never taken into account in dividing profits. For example, a business must employ someone to do the sales. If you have a partner doing sales then he must be paid allowance/commission. Assume there is no such compensation is paid; in that case it is against all the principles of business to divide profits equally

5. You can have several partners; but the real operation is minded by one or two partners. In case there is a managing partner, he must be paid emoluments in correspondence to what the market pays. Assume that he is paid a meagre allowance, can the partners decide to allocate profits equally. It is a cardinal duty to pay man’s wages in a proper manner

6. Not every partner can bring business or nurture customers and clients. Among partners there could be one person who holds a magical wand. He has the charisma and personality to get going with people and situations; a kind of a doer. He possesses cosmics that attracts the customers and turn sales opportunities into fruition. Such partner has cosmics that shape and influence partnership business positively. If he goes away the partnership would also wither away. If you are a partner in this business would you insist that profits must be divided equally?

The conclusion is simple. No partnership should divide profits equally but equitably. In the latter case you have to examine the contribution by each partner in terms of capital funds, level of interest and the aspect of cosmics and arrive at an equitable manner in dividing profit among partners.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Three Ways of Buying into a Business

 

The difference between buying a business and buying into a business is very simple. When you take 100% stake you buy it. When you take less than full ownership you are buying into it. This rule does not apply to large companies or listed ones. Let me elaborate three ways of buying into a business:

1. Making a Strategic Partnership: This is the time tested method of buying into a business. Instead of taking large portion of the shares or equity you lock in for a 25 to 30
% stake. Before getting into negotiation with the prospective business owners you should evaluate what kind of synergy you will have in partnering with them. You must concentrate upon several aspects chiefly, marketing, operations, human resource, systems and finance. Strategic partnership is only possible where the interest of you and the present owners can tally together. By any chance there is no interest tangent possible between you and the owners then you should not proceed further

2. Floating a Joint Venture: In this case you buy out 50% of the stake of the current owners and morph the business into a joint venture. Joint Ventures often called as JVs, though not very common are very effective means of combining strengths of two parties. Similarly unlike in the case of strategic partnership you would not be wholly concerned with the past performance of the business. It is the future that matters. How the business under a JV would turn out to be is a cardinal question. Such JVs must eliminate if not neutralize any current weaknesses of the business and maximize the future strengths of the business. For example, let us assume that the business order book is fairly seasonal; this is a nagging weakness now. After the JV is floated you must be able to alter that seasonal nature of sales and generate regular orders throughout the year

3. Taking Majority Control: A popular method often sought after by prospective buyers is taking majority stake in a business. Such a majority can come about if you take 51% or more of the equity. To be on the safe side it is always better to take between 60 to 70 % of the equity control of a target business. In this case you have to handle two issues: one relates to what to do with the minority shareholders or owners, the other is to see how you can handle transition of control from the selling party. It is common knowledge that once controls changes hands there would be quite rumbling from the minority. They generally resist changes and fear that the new management might neglect their interest. You have to be ready to face this situation and must make every effort to take them into confidence. You have to treat them equitably as well. The second issue of transition tends to be much tougher. You have got too many irons in the fire. There are parties like customers, creditors, staff, lenders, bankers and host of others who like to be assured that the new management would not act counter to their interest and purposes. Moreover, seamless integration of the business systems prevailing in the target business including finance, operations and marketing into your own systems could be a nightmare.

4. Choice: What is the best way of buying into a business depends on the amount of money you have and the level of contribution the target business could make towards your own objectives. More than anything else, you should evaluate a key driving force. That is your cosmics. It is better for you to choose the appropriate method by evaluating your cosmics. You know, that, cosmics are aspects residing within you shaping and influencing your business throughout. If your cosmics support a simple ownership with benefits you settle for a strategic partnership. On the contrary, if your cosmics dictate that you should go for high risk taking then choose either JV or majority control whichever that suits you fine.

 

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog

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Seven Steps in Preparing a Business Plan

Business plan is a vital document for any type of enterprise. It serves two purposes: one as an internal guidepost and the other as an external statement of purpose. You can easily prepare a business plan if you follow the seven steps listed below:

1. Look Out: The first step in preparing your business plan is to just look out at the environment. You see what is happening in political, economic and social spheres. You find out what your competitors are doing; anyone is closing shop and any new entry into your field. You watch how products similar to yours are performing in the market. All these can be summarised in two words: Opportunities & Threats. Management analysts place a major emphasis on understanding and evaluating opportunities and threats facing a business. Once you get a hang on this subject you can move on to the next step

2. Look In: This step is all about self-examination; the reverse of what you have been doing in the first one. Here you are assessing how you can respond to the status of affairs prevailing in the external environment. How are you positioned; what do you have; what you should get rid of; how do you optimize pluses and minuses. This stream of activities can be summarised in two words: Strengths & Weaknesses. These two are pitted against the opportunities and threats explained earlier. Once you identify and evaluate your strengths and weaknesses you can find a via-media to maximize your strengths and minimize your weaknesses

3. Set Objectives & Goals: You have already learnt much about external and internal aspects. Now it is time to find out what kind of tools you have to make external opportunities work in your favour while at the same time ensuring that you are not unduly threatened by external forces. Moreover, the tool must ensure that you can maximise strengths and minimize weaknesses. This tool is known as ”optimization of business”. In optimization you begin to set objectives and goals. Objectives are set in broader qualitative terms, for example: business must achieve higher market share. Goals on the other hand zoom in the objective into a specific quantitative measurement. For Example: business, must achieve 25% market share. Objectives and goals vary from business to business. Broadly these cover : Quantum of sale; market share, product quality, product differentiation , customer service, diversification, best practises in managing resources within business including human resource, physical assets and financial assets

4. Craft Strategies and Tactics: Once you have set objectives and goals for your business, you must proceed to formulate strategies and tactics. Strategy is a broad area of approaching the objectives whereas tactics are narrowed down field for you to achieve the goals. As an illustration look at your objective of achieving higher market share; here you prefer to use a strategy of advertisement & promotion. Conversely, your goal of achieving 25% market share is best attempted via a campaign tactic focussing on aggressive marketing. By the time you are in the middle of the campaign surely your competitors follow suit. Hence, the usefulness of this measure is just tactical for the moment

5. Put it in Writing: As you get thorough knowledge and understanding you can put your thoughts in writing a business plan for you. This plan highlights all the aspects covered so far and includes all key facts. Additionally, you include mission and vision, monitoring and evaluation of the business plan, sub-plans for critical sectors such as marketing, operations, human resource, information systems etc..

6. Dress it with Figures: The most difficult step in the process of making a business plan is to reduce everything into figures. You are comfortable with facts, bur when it comes to figures you shiver. Not to worry, you can do as much by trying it alone, or following a standard business template or in extreme cases you can hire an accountant to cast figures for you. Remember figures are necessary as they stand as bench mark for you to do monitoring and evaluation later

7. Time it well: The final step is about time; everyone knows time is in essence; time gives you relief. We call this cosmics. There is time for everything. You have to push your button for business plan on the first day of January, barring any holidays. During January, you get a sense of new beginning and time to sit and think about your business plan. Cosmics of time in making business plan is like Christmas; it comes once a year.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Tips on Using Others Money in Business

Capitalism and Rome are not built in a day. It takes quite a while to build up your own business capital. Till such time, you have got to use others money. Here are some tips on using others money in your business. For easy reading, I have categorised using others money in three major phases: Initial Capital, Operational Phase and Growth Stage:

Initial Capital

At the time you start a business you need what we call as seed capital. When you are short of this money you must find alternative sources to supplement this shortfall. Here is a list of such sources:

1. Small Business Corporation. Most countries run a Small Business Corporation that lends portion of your capital in easy terms

2. Venture capital Companies: If you have an excellent business idea that can be turned into a successful venture you must consult with venture capitalists and obtain finance

3. Government Grants: In addition to provide loan capital there are grants made available by the Government Institutions for businesses

4. Informal sources: You can also get initial capital from family & friends on no-cost basis or in concessionary terms

Operational Phase

When you move into operational phase you get receivables and creditors. You will also require a whale of a lot of money for operational expenses such as salary & wages, utility and statutory payments. Here are effective tips:

1. Negotiate very favourable terms from your creditors. These terms should cover bulk discounts, extended period of credit, timely delivery schedule and stand-by measures

2. You should, as matter of fact, encourage cash sales and when you are faced with a credit sale you must ask for an advance; where you are getting bulk buyers on credit terms get some short of deposit from the debtors

3. Obtain a Working Overdraft / Operational Line: Banks generally extend working overdraft/operational line of credit for financing working capital. Your seasonal ups and down in money needed to finance working capital can be smoothened by this arrangement. Furthermore, these credit lines also offer safety valve in paying your operational expenses including salaries, wages and utility payables

Growth Stage

As your business notches up on to the growth stage, your money requirements change in terms of quantum and period. Now you need more money and for a longer duration in order to expand as well as to finance the growth of business. Here are good tips:

1. Go for a Fixed Loan/Term Loan: Generally banks and finance institutions offer term loans for long term capital requirements such as buying into fixed assets or improving existing fixed assets. In some cases you can also acquire new assets as well. In the latter case, there is an alternative in the form of equipment leasing

2. Issue Preferential Shares: These shares may be issued with a stated interest rate and made redeemable on a future date. I recommend the issue of preferential shares over equity shares because preferential shareholders are not entitled to take part in running of a business whereas equity shareholders can control the management of a business

But wait a minute. Do you possess the required cosmics for using others money in your business. If you have the right cosmics you can prosper on others money. What are cosmics? Cosmics are aspects residing within you shaping and influencing your business though these are un-seen and un-noticed by you. So first and foremost check whether you have supporting cosmics that enable you to use others money successfully.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/

Why Small Business Needs a Logo?

Most small business enterprises are run without a fitting business logo. When you ask a small business entrepreneur why he does not have a logo he would have a stock reply: I have no time to bother about petty affairs. More than a big business, it is the small business that requires a logo badly. Let me enumerate chief reasons why small business needs a logo.

1. Representation: A logo is similar to an owner or an employee. It represents small business to the people in the outside world. A business logo is ascribed living qualities. In commercial activities a business logo is just a party as the owner and his staff

2. Recognition: For a small business, logo functions as a brand. Commercial enterprises immediately recognise a brand; so do the customers, creditors, lenders, bankers and other business actors. A successful small business needs an appropriate business logo; vice versa, to succeed, a small business needs recognition and a business logo

3. Identity: A logo for a small businessperson is basically an identity card or a passport. He can just show the logo and gain entry into many places. Besides, a logo is unbreakably connected with the name of the business and the staff employed therein

4. Image Projection: Undoubtedly, a business logo projects the image of a small business to the outside world much more effectively than promotions and advertisements. It is true that you need both for initially getting into the attention of customers and clients. But once you achieve your goal in getting attention sustaining it requires a well-designed logo

5. Communication: Logo is not just a symbol, form, or lines and letters; it is more than that. A business logo essentially is part of business policy. It communicates the mission and vision of the business; its policies and practices; its commitment to uphold ethical principles of trade. Moreover, business logo conveys company strategy and directions to parties dealing with that business

6. Uniqueness: Every logo is unique, true enough. Yet there is something else in uniqueness for a small business. One with a well-crafted logo stands out among large numbers of small business enterprises; besides it automatically gets up-graded into the class of big business

7. Generates Responses: What kind of a response a logo elicits from those who look at it. Every day you see thousands of business logos. So what is the fuss about a logo doing something for a small business? The answer is very simple. For a small business a logo gets feelings of attachment, sense of appreciation, positive emotions, and rational calculations and finally “let’s try out this company” attitude in the onlookers

8. Transcends Time: Most business logos can outlive its creators and / or users. In the case of a small business it is doubly important because in small businesses there are more chances of changing hands or rapidly being wound up. Whatever happens, a logo transcends time and is passed into new owners and successors like a baton in a relay race

9. Fountain of Cosmics: Logos have inherent cosmic power; you can feel this cosmic power when you look at famous business logos; Apple, Coca-Cola, Google, IBM, Lego, Microsoft; all these are fountains of cosmic energy. These logos not only generate cosmic energy but translate it into cosmic power in the form of sales, profit, goodwill and a groundswell of positive feelings and emotional attachment to the underlying products. Conversely a business logo that is designed without taking into considerations of inherent cosmics could turn out to be very destructive to its owners and users. A good example is the Nazi Swastika that finally destroyed everyone connected with it.

Muthu Ashraff

Cosmic Adviser

Mobile : +94 777 265677

E-mail : cosmicgems@gmail.com

Web : http://www.cosmicgemslanka.com

Blog : http://cosmicgemslanka.com/blog/