participation activity:form of ownership research/discussion•buying an existing business (1)•sole proprietorship (2)•partnership (3)•corporation (4)•dealerships (5)•joint ventures & associations (6)

…using your textbook & other sources, read about and research your assigned business type…come to class ready to discuss your findings

INTD 55 business practices

planning for profit and growth

Understanding who we are, what we are capable of, and how we can best perform within the

business world is key.

planning for profit and growth

designers need to measure their love of the design process against the time spent and the money earned

developing a firm—•understand its best abilities•realize what you have to work with & go after work that is appropriate for your team•missing spots filled by consultants•key areas covered by principals of firm•review market to determine needs—know community dynamics

planning for profit and growth—planning

•establishes priorities•provides a map and direction for activities that lead to achievement of goals•makes decision making simpler—provides a tool to measure against

without a plan it is easy to make no decisions or to be pushed & pulled by events

be proactive instead of reactive

planning for profit and growth—setting goals

deal first with personal professional goals & then financial goals of company

personal goals:•do they fit realistically in the interior design field? how long do you want to stay in the field?•where do you see yourself in 3 years?•what annoys you? what make you happy?

•write down goals•organize in order of importance•readdress goals every 3-6 months

planning for profit and growth—setting goals

business goals—•define clearly•possible goals might be growth, increased profit, increasing the rate of profit, increasing market share•consider where you want to be in 5 years•be flexible

procrastination can keep you from reaching goals

mission statement used as a constant daily reference helps keep you on the right track

formulating a business plan

1.type of business2.location3.product4.facilities required5.marketing plans6.your competition7.available funds8.revenue expectations9.expense projections10.administrative structure11.support services & staff12.your time schedule

planning for profitfactors that affect your profits

liability is a huge issue these days—insurance can reduce your cash losses

job processing—the faster a job can be completed the more profitable it is

accounts receivable expected to be paid within 30 days—more realistic within 60 days

making each job extremely different make profit projections difficult—firms that specialize tend to be most profitable

planning for profitways to increase profits

1.increase total sales or amount of income secured by firm2.increase the amount of profit or markup

growth is really the key to profits •should be a gradual process •should occur by improving services

planning for profitanalyzing your firm and its direction

important to take the time to do analysis of projects every 5-10 years.

to make analysis easier, document each project consistently & with the following information:

1.name of the project2.name of the client3.location of the project4.type of construction5.size of the project6.type of services the firm provided7.design accomplishments

planning for profitanalyzing your firm and its direction

8. size of the fee9. profit of the project10. percentage of profit on the total project11. source of the job12. expected referrals13.publicity potential

how can you use these projects as a base foracquiring new projects over the next 5 years?

planning for profitevaluating your team

once you define firm’s direction then it must be determined whether your staff or team is properly oriented to handle objectives—evaluate each & every member and keep evaluations/lists of abilities

evaluate any top-level consultants that you partner with as well—they may be capable of working with us in ways we are not aware of

selling your business

when you open a business, you should know how long you are going to keep it and how you are going to sell it

if you are making the investment & going to the effort of establishing a working company it should be something valuable

ask yourself before you start how can you create a company that has value, could continue, and be saleable?

selling your business

If you plan to sell in the next few years:•try to show as much profit on your books as possible•spend time developing your clients & establishing contracts•organize copyrights or patents•update mailing lists•reexamine inventory with an eye toward eliminating what is not current•hire a good appraiser to evaluate your building & various advantages of property location•organize your business management system so it can easily be taken over•review workforce and try to line up best people possible•take stock of your financial situation—with your accountant, determine how much capital is required to run the business

participation activity:mission statement

…research & read mission statements from successful businesses and other institutions…brainstorm what you want in a business, combine this with what you have found from your research & create a rough draft of your mission statement

…be prepared to discuss your mission statement in the next class