This post was authored by Salvatore M. Capizzi, Dunham's Chief Sales & Marketing Officer. If you have questions concerning today's topic, please call us at (858) 964 - 0500. Hold us to higher standards.

Let us say your client is tired of working for someone else and announces she will start a small business. She meets with you to review the investments you manage for her and asks you advice on starting a small business. She asks, “you started a business, didn’t you?”

You know she will have many balls to juggle, just as you did when you started your business. From managing her day-to-day operations to finding new customers and building a brand, it will be easy for her to get caught up in the details and forget about the bigger picture.

One critical aspect of small business success is the initial and ongoing business planning she conducts. Lucky for her, planning is your superpower. In this week’s Dunham blog article, we will discuss tips and strategies for you to help small business owners create a comprehensive business plan.

Create a Business Plan

Writing out a business plan is an essential step for clients starting up a small business. A business plan is a roadmap outlining goals, strategies, and financial projections. It is a way to help them identify potential challenges and opportunities and provide a framework for making informed decisions.

When creating a business plan, they should be outlining their overall vision and mission. Their vision and mission statements should include a description of their business, products or services, and target market.

They should also be outlining their marketing and sales strategies. Their strategy should include an analysis of their competition, pricing strategy, and marketing plan.

If they plan to raise money to help lift the business off the ground, their business plan should also include a detailed financial analysis. This analysis should consist of a sales forecast, profit and loss statement, and cash flow analysis. They should also include information about their funding needs and how they plan to use any of the funding they receive.

Writing a business plan can be time-consuming but is an essential step for any small business owner. A well-written business plan can help them secure funding, attract customers, and make informed decisions about the future of their business.

Raising Capital

There are many ways for your small business client to raise capital, but this depends on multiple factors.

If your small business owner client does not want partners, they can raise capital through using personal savings, credit cards, or other personal assets to fund the business. While this method can be risky, it can also give the business owner more control over the company’s direction and growth.

One of the most common ways of raising capital is through equity financing, where investors buy a stake in the company in exchange for capital. Friends, family, venture capital firms, angel investors, or crowdfunding platforms are places to look to accomplish this.

Loans from a bank are another way to raise capital where the business borrows money and pays it back with interest. This can be a good option for small business clients with a solid credit history, a clear repayment plan, and where they do not want partners.

One often overlooked place for small business clients to raise capital is through grants or government programs. These programs are designed to support small businesses and can provide funding for specific projects or initiatives. One of the best websites I found is from the U.S. Chamber of Commerce, with grants available for a large variety of businesses.

Regardless of the method chosen to raise capital, your small business client needs to clearly understand their capital needs and develop a comprehensive plan to raise the necessary funds. This may involve creating the detailed business plan we discussed above and networking with potential investors or lenders. By taking a strategic approach to develop capital, small business clients can potentially position themselves for long-term success and growth.

Banking Relationships

Developing banking relationships is a crucial key to small business success. A strong banking relationship can provide you with access to credit, cash management services, and other products and services to help your small business client grow and thrive.

When developing banking relationships, your client must conduct their research. They should start by identifying banks with experience working with small businesses in their area. Encourage them to seek banks that offer the products and services they need, such as checking accounts, savings accounts, and lines of credit.

Once they have identified potential banking partners, your small business client should contact them to schedule a meeting. They should use this meeting to discuss their business needs and learn more about the bank’s products and services. Ensure they ask about fees, interest rates, and other costs associated with the bank’s products and services.

As a small business, they must establish a relationship with their banker. This relationship can help them build trust and credibility with the bank, which can be beneficial if they need to apply for credit or other financial products in the future.

Choosing an Accountant

A good accountant can provide valuable insights into the financial health of your client’s business, help them identify areas for improvement, and provide guidance on tax planning and other financial matters.

When looking for an accountant, there are several things your small business client should consider. First, look for someone with experience working with small businesses. As you know, small businesses deal with unique financial needs and challenges, and working with an accountant who understands these types of challenges is essential.

They should next consider the accountant’s qualifications and credentials. Direct them to look for someone who is a Certified Public Accountant (CPA) or has other relevant certifications. These certifications demonstrate the accountant has the knowledge and expertise to provide high-quality financial advice.

Create a Budget

No different than in your practice, a budget is the financial roadmap that outlines your small business client’s expected revenue and expenses. They must create a budget to help them understand their cash flow and identify areas where they can cut costs or invest more money.

To create a budget, they should gather their financial statements, including their income, balance, and cash flow statements. These statements will give them a clear picture of their business’s financial health.

Once they clearly understand their financial situation, they can start creating their budget. They should begin by identifying their expected revenue for the year. Revenue can include sales, investments, or any other sources of income. Next, they need to identify their expenses. These can include rent, salaries, supplies, and any other costs associated with running their business. Make sure they account for any unexpected expenses that may arise.

One of the most important pieces of advice you can give them is to understand that their budget is a living document they update regularly. As your small business client starts tracking their revenue and expenses, they should compare it to their monthly budget to see how they are doing.

They may need to look for new revenue streams if they are not meeting their revenue goals. If their expenses are higher than expected, they may need to cut costs or find ways to reduce their overspending.

Separate Personal and Business Finances

As small business owners, they must keep personal and business finances separate. This separation will help them avoid confusion and mixing business and personal expenses.

Separating their finances can also make it easier for them to track their expenses and prepare for tax season. As you know, when it is time for them to file their taxes, they need to provide a detailed accounting of their business expenses. It can be challenging to provide accurate accounting if they mix personal and business expenses.

You can recommend opening a separate account for their business to separate their finances. They can use this account to pay for all their business expenses and deposit the revenue they receive. Make sure they keep detailed records of all transactions, including receipts and invoices.

Plan for Taxes

As a small business owner, your client will hopefully have tax obligations! Planning for taxes can help them avoid surprises and ensure they have the funds available to pay their tax bill when it is due.

Your client who owns a small business should start by understanding their tax obligations. This understanding includes federal, state, and local taxes and any payroll taxes they may be required to pay. Remember, they may have to pay quarterly estimated taxes to the IRS. Their accountant can help with this task.

Establish an Emergency Fund

As a business owner, your client may face unexpected expenses at any time. It is crucial to have an emergency fund set aside to cover unexpected costs. Their emergency funds should be separate from their other accounts and easily accessible. A good rule of thumb is to set aside three to six months of operating expenses in their emergency fund.

Their emergency fund can provide a safety net in case of a cash flow issue or unexpected expense. It can also help them avoid debt or dipping into their personal savings to cover business expenses.

Invest in Retirement

As a small business owner, they may not have access to a traditional employer-sponsored retirement plan. However, you can help them examine the many available retirement plan options, such as a Simplified Employee Pension (SEP), SIMPLE IRA Plan, or a Solo 401(k) plan, to help them save for retirement.

Investing in retirement is essential to ensure long-term financial security. Setting aside money in a retirement plan allows your business owner clients to take advantage of potential tax savings and tax-deferred returns.

Summing it Up for Your Small Business Client

For your small business client, planning is critical for the success of their small business. By creating a budget, understanding their business’s financial health, planning for taxes, establishing an emergency fund, investing in retirement, and seeking professional advice, they can potentially have their business on the path to success.

It would help if you reminded your small business client, as it is for you, planning is a continuous process, and it is essential to regularly review their financial plan and adjust as needed. By staying on top of their plan, they can potentially build a successful and thriving small business.


“51 Grants, Loans and Programs to Benefit Your Small Business” by U.S. Chamber of Commerce, (n/d)

Disclosure: This communication is general in nature and provided for educational and informational purposes only. It should not be considered or relied upon as legal, tax, or investment advice or an investment recommendation, or as a substitute for legal counsel. Any investment products or services named herein are for illustrative purposes only and should not be considered an offer to buy or sell, or an investment recommendation for, any specific security, strategy, or investment product or service. Always consult a qualified professional or your own independent financial professional for personalized advice or investment recommendations tailored to your specific goals, individual situation, and risk tolerance.

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