No matter how long you have been in business, it is easy to become lazy in your business approach in the areas of financial, customers and self-management skills. Listed below are some tips to help you run a more successful business.

• Avoid overspending on overhead. Whenever possible, contract out and hire part-time high school students rather than full-time employees to avoid paying high salaries and benefits such as insurance and Social Security.
• Avoid overspending on equipment. Figure out what you want to purchase over the next three to five years that will support your goals in terms of the business's growth. Spread out your buying over time rather than buying everything all at once.
• Check out references on potential clients. If you are on an accrual basis (accounts receivable and accounts payable), it is important to keep an eye on your receivables so they don't become a burden to your wallet. Check references on new clients to make sure they are honest and on time with paying their bills. If you feel they're going to be more of a burden than they are worth, then don't do business with them.
• Know your pricing. When pricing your services and profits, make sure your pricing covers both your fixed and variable expenses as well as your desired profit margin. Avoid undercharging so your business doesn't hurt financially and you don't give yourself and your products and services an image of undervalue. Also avoid overcharging where your prospective clients won't spend.
• Plan, budget, and review cash flow. Have a savings nest egg for low financial times and times when you want to diversify or expand. Review your budget monthly for investment planning and covering expenses.
• Offer incentives on accruals for early payment. Offer discounts or other incentives to enhance early payment. Check your outstanding receivables on a monthly basis and follow up on late payers.
• Know your boundaries when dealing with clients. Over-promising on areas you are unable to meet or do and overdoing can lead to disrespect, a feeling as if you are being taken advantage of, and possibly losing customers.
• Think of everyone you meet as a potential client. Use human relation skills to make good long-term relationships with people you meet and enjoy in both personal life activities and business. This assists in building your customer base, getting referrals and acquiring loyal customers.

INVEST AND DIVERSIFY

• Invest part of your savings in higher paying returns. Invest part of your savings once you have acquired a substantial amount for higher returns. Diversify your investment portfolio based on how the market is doing. For example, research companies that are doing well over a long period of time and show stability, then invest in their stocks. Invest in bonds when the market has high interest rates and when you are in a high tax bracket and want to defer paying higher taxes. Invest in mutual funds when you want to spread the risk.

Don't forget to invest yearly in a retirement plan to have money to live on when you retire. You don't want to rely on Social Security alone, especially since it may not be there when you retire.

It takes time, perseverance and patience to achieve goals.You want to stay focused on your vision, removing any obstacles as you do current reality checks for progress. Rather than be rigid and narrow in solving challenges and creating new ideas, be creative and stay open minded. It is more fun. Learn from your mistakes to avoid repeating them and to develop personal and professional wisdom.

Spending too much on overhead and equipment can hobble a new business.

Contracting work out is another good strategy. Most small businesses are on a tight budget and therefore have difficulty contracting work out. You can overcome this difficulty with effective planning/decision-making on where and how to spend your money. Use your talents, skills, and abilities to their fullest, and delegate out those areas in which you are not as efficient or do not have the time or desire to do.

You want to be cautious on how much to spend, yet not penny-pinch by selecting those who are the cheapest. Sometimes selecting the cheapest can be the most expensive if you end up paying for their costly mistakes and limited amount of expertise spent in that area. Prioritize the parts of your business you can cut costs on, and negotiate the other parts with the various parties you have chosen to do business with. By doing this, you are able to use your time wisely and are able to focus your time on your talents, skills, and abilities as you make your business more profitable.

When you are planning to assign work out, it is important to do a background credibility check on those people you plan to contract work to. One way to do this is with their customers/clients from various industries. If possible, select at least three long-term and short-term customers (clients), so that you are able to get a more accurate account on the business's credibility. Make sure the people you are researching to contract work out to have a reputation for honesty, efficiency and valued services and/or products.

CHARACTER CHECKS

The first thing you want to check on is the potential contractor's character. Does this person have integrity and honesty? Does he/she walk the talk or say something yet not portray it? Does this person lie, using sweet talk to cover it up stating how their intentions are good yet are not? Does this individual do the job effectively or make lots of mistakes?

If the answers to these questions are swaying towards dishonesty and/or inefficiency, you don't want to do business with him/her. You don't have to play the victim game, allowing these people to take advantage of you and your business. You will avoid the possibilities of being misled by con artists who use techniques, such as flattery, over-promising and enticing with premiums, discounts, or cost reductions. You will also have peace of mind when it comes to hiring them. Dishonesty and little integrity are red flags on doing business with this person.

The next area to check on is the business's stability. Stability and longevity are important in your selection process.

Is this company registered to do business in the residing state? How long has the business been around? Is the business run by the original owner or have there been numerous owners? If the business had many owners or a high turnaround of employees, that could be a red flag on the stability of the company.

Subcontracting out work is a good way to leverage a business's resources.

The last area is the owner's work ethics. How efficient is he in getting the work done? Does he meet his deadlines or come up with excuses on why they have not been met? These excuses can be extremely costly when you have to turn around and reschedule things. As you collect your information and weigh it to make your final decision, it is important to trust your intuition.

Type an agreement. It is important to know what is expected from both parties when negotiating a business decision.

Follow-up is important during the period the service is being provided, but it must be done in a balanced manner. Avoid being either too rigid or too lenient. Offering positive comments on the provider's work can be more effective in correcting deficiencies than focusing on the negative.

Jeanette L. Rosenberg is a business advisor, motivational speaker and TV producer in Kirkland, WA. She can be reached at 206-828-6426.