DAC Vision
A Monthly Update for Optical Laboratory Owners and Managers January 2009

Made possible by an unrestricted grant from DAC Vision

New Products
 
Operating Strategies
Bob Niemiec

Bob Niemiec










Distinguish Yourself in a
Commodity World

Oil at $140 per barrel in July, oil below $40 per barrel in December. Aluminum at over $1 per pound in October, 65 cents a pound three months later; copper prices nearly $4 per pound during much of 2008 now around $1.40. Across the board, prices for commodities, products which can indistinguishably be purchased from any number of sources, are falling. Even products that are not generally thought of as commodities like autos are experiencing considerable price pressures as well.

commodity

Outside of the possibility that some of these falling commodity prices might eventually translate into lower prices for the frames, lenses and consumables, the message for producers of finished eyewear is simple. If you haven’t distinguished yourself in other dimensions (service, quality, product variety/capability, etc.) other than price you are going to be under even greater price pressure in the increasingly tough business environment that we are in today. Being a low cost producer, while an advantage, is a benefit only to the extent production costs play in the total transaction.

For a lab to be successful in an environment where poly progressives in stylish frames are routinely being trumpeted at $149 or less, other factors come into play. Having your cost act together is a given, so is quick service as well as flawless quality. For a lab provider to become a “non-commodity,” service must be consistently quick, no exceptions. The customer service representatives must be able to do more than tell the caller where their frame may be in the process or when it might be delivered. They need to be able to offer value added solutions to customers' problems and inquiries and do it the first time.

To accomplish this, they need to be in sync with the lab in that the solutions they promise are indeed the ones that lab can deliver. Having highly trained people who can communicate with the customer to consistently devise and deliver these solutions is one area where a lab can distinguish itself from the commodity labs which compete primarily on price. The investment in people, process and technology needed to become a solutions oriented “non-ommodity” lab is significant but then so is the return on that investment.

—Bob Niemiec is president of Optinova Solutions, LLC, a consulting firm specializing in operations improvement, new technology assessment and mergers and acquisitions, primarily in the optical industry. An optical industry veteran, he has held senior level positions in manufacturing and distribution with large optical retailers and manufacturers. He can be reached at rn.optinovasolutions@yahoo.com.

 
Tech Talk

Layout and Blocking Tips

Finishing layout or blocking is the first step in finishing. An uncut lens is placed on the layout machine and attached to a finishing block. The block holds the lens so it can be edged.

Precision Edge Blocking Pads

Precision Edge Oval FlexBlock courtesy of Precision Tool Technologies.












Potential Problems
The lens can be layed out incorrectly, so it is cut off center, which can create prism problems, or cut off axis. The lens can be improperly affixed to the block, which leads to slippage and other problems when the lens is being edged.

Troubleshooting
The most important aspect to the layout are the proper measurements, including Pupilary Distance, the DBC (Distance Between Centers, also known as the frame PD), and seg-heights for multi-focal designs. Not following these precise measurements results in the lens being cut off-axis, which can create unwanted prism. An easy but common mistake is laying out the wrong lens for the wrong eye. (for example, laying out the left lens for the right eye.) These measurements are marked on the lens with a layout marker. If the lines are not crisp, clear and straight, the edging will be off.

Another concern is how well the lens is affixed to the block. Blocks must be kept cleaned and dry. They are precision instruments, an not only will nicks or grooves effect how well the lens is affixed, but a damp block creates adhesion problems with the finishing blocking tape (also known as leap pads). Use quality tape be used, and thoroughly test all new brands of lenses before putting them into production. The result can be slippage, when the lens slips from the block in the edger. This will cause chipping and sometimes gaps, and in some cases, lens cracking. But whether a chip or a crack, the final outcome is the same—the lens is ruined.

Some premium lenses, especially high-minus prescriptions in high-index materials, often require more than one cut in the edger. It’s best to remove the lens from the edger after the first cut and re-block the lens using fresh pads and blocks. These lenses can be more prone to slippage, and re-blocking the lens will prevent slippage.

 
HR Corner

Finding and Keeping
the Best Employees

World Globe

Human resource management will become increasingly challenging in the next five to 10 years, according to Global Human Resource—The 20 Worst Mistakes that Companies Make, a report published by the Economist Intelligence Unit. The report highlights the need to increase the time and effort dedicated to human resources in order to be successful in an increasingly competitive market.

The report cites the shortage of talent as one key area which will become more difficult as time goes on. This applies directly to eyecare professionals who seek highly qualified, experienced, talented and customer-focused team players.

As business organizations and eyecare practices struggle to meet the demands of customers, the real competitive advantage will stem from human resources.

The report further cites several key issues which it states “tend to be the same everywhere:”

  • Recruitment

  • Retention

  • Declining quality of candidates—or not enough qualified candidates for a growing number of opportunities

  • Salary increases

  • Compensation package benefits

  • Leadership development

Finding staff, keeping them and rewarding them appropriately are identified as three major problems in human resource management. If you can get the best one, two or three staff members for your lab, then this will generate the crucial competitive advantage, according to the report.

Hedley Lawson brings over 25 years of optical industry experience to JMI. For over 10 years, he has been a contributing editor to VM, most recently as writer of the monthly column “Business Essentials.” He is the Contributing Editor of VM's E-Newsletter Business Essentials.

 

 

economic forecast

Decision Making: Tools of the Trade, Part 1

Today's rough economic climate makes decision analysis all the more important for the independent lab. Not only is there declining demand for profitable products and services but also stiff competition from well funded supplier owned labs, big box retailers and third party plan owned labs. You may not have a warehouse full of MBAs, or a history of making multi-million dollar decisions, but you can implement some of the tools they use in your decision making.

Earlier columns discussed the importance of creating an annual budget based on proper accrual accounting. That’s the first step. Next the budget is not only used as a tool to manage the expenses of the business, but also can be used to apply different decision scenarios to forecast various outcomes of making a decision. From the budget, a forecast of monthly cash flow (cash received less cash spent) for one year is presented. This is also known as a statement of sources and uses of cash. The one-year forecast can then be extrapolated out for multiple years to estimate cash flow in the future. Multiple economic scenarios with different variables are then applied to the forecast to show the expected cash flow, for example, if the business will grow or decline by X, Y, or Z percent per year. After the baseline is constructed for various economic scenarios, the forecast can be used as a tool to estimate the potential results of alternative decisions. Some key elements applied to the forecast for decision making should include:

  • Risk vs. Return Analysis

  • Discounted Cash Flow Analysis

  • Payback Analysis

  • Return on Investment

  • Internal Rate of Return Analysis

For example, you are considering purchasing digital surfacing equipment and licensing the technology because your customers have begun asking about it. Applying the quotes from alternative licensors of the technology and equipment suppliers to the forecast, you can estimate which choice will possibly generate the most cash, pay back the quickest, generate the highest return, or which you (and your bank) can afford.

These models are not meant to be the only means with which you would make a decision, but they are useful tools to aid you in that regard. Future columns will describe more fully the analyses mentioned above and provide examples of their use. These are some of the same tools used by larger corporations in all industries including your large competitors. Put to good use, they can help you make better informed decisions for your business.

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Jason Meyer—Jason A. Meyer is senior vice president, HPC Puckett & Company. Based in San Diego, Calif., HPC Puckett & Company specializes in mergers and acquisitions of wholesale optical laboratories. You can send comments or questions about this article or any other Dollars & Sense articles to Jason Meyer at jam@hpcpuckett.com.

DAC Vision
 

Paula M. Yetz of Perferx Optical

Paula YetzWhen Paula Yetz was hired at Perferx Optical six years ago, she began working in the surfacing department of the family owned, Pittsfield, Massachusetts wholesale lab. At first, Yetz ran the cylinder machines, but she soon learned other jobs in the surfacing department. Within a year, her duties were expanded to include finishing, and she began training as a drill operator.

“As our company grew there was a greater need for cross-training, so I've been trained to do most jobs in our finishing department as well,” Yetz said. When a full-time position opened up in drilling, she took the spot permanently.

Since starting at the Perferx Optical, Yetz has continued to move up. She is currently working in final inspection, as well as running Perferx's AR coating room.

“I've come a long way since 2002,” she remarked. “When I started, I didn't know anything about the optical world, and now I'm able to process a lens from start to finish.”

Yetz's day-to-day activities never stay the same. “It can get pretty crazy around here,” she said. “Nothing is ever set in stone.”

Her main responsibilities consist of completing drill work in a timely fashion and in accordance with Perferx Optical's high standards. Additional responsibilities include final inspection, ordering lab supplies, repairing eyeglasses, making sun clips, making patterns, lens washing and blocking.

Yetz's past employment consists mostly of retail. After graduating college with the goal of becoming a certified medical assistant, she had difficulties finding a job. She applied at Perferx and was hired.

“I take pride in the work I do,” she said. “I'm not satisfied unless I keep going. I stay motivated by learning new things and facing new challenges.”

Yetz describes her work for Perferx as very rewarding, and she is very proud of her company and co-workers. “Perferx is known for its high quality work and excellent customer service. It's a great feeling to know that I'm part of that reputation, and I work with some really great people! Through my hard work and the encouragement I get from my managers and co-workers, I've become very capable and confident at my job.”—Samantha Toth

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DAC Vision
 

Survey Reveals ECPs Attitudes About Labs and Lenses

Last month, Lab Advisor published some key findings from L&T magazine's recent annual Lab Usage Survey. Two hundred and eight independent vision care professionals and optical retailers were polled to find out their perceptions and attitudes about their optical labs as well as the essential products and services the labs supply to them. Here are some additional survey highlights.

Digital Surfacing Lab Study 2008

Top Line Analysis

  • Most labs that sell spectacle lenses offer online ordering.

  • Only 36.0 percent of respondents have ever sent in frame tracing data with an online order.

  • 8 out of 10 locations are familiar with the lens technology term “digital surfacing.” Of those who are aware of this lens technology, 58.6 percent currently dispense progressive lenses manufactured by digital surfacing lenses.

  • Fewer of the locations have lens edging capability in-house. In 2008, only 38.9 percent edged lenses in-house, down 12.3 percentage points from the previous year.

DAC Vision
Barbara Dietz

Barbara Dietz and Ed Dietz III

Dietz Laboratories Marks 75 Years in Business—Dietz Laboratories, which celebrated its 75th anniversary in October, is among the best known and most respected optical labs in Texas. Located in Fort Worth, the independent wholesaler has earned the loyalty of several generations of customers by providing quality products and personalized service.

Ed Dietz, Sr. founded Dietz Laboratories in 1933 and ran it for three decades. He was succeeded by his son, Ed Dietz, Jr., who died in 1990. Since then, his son, Ed Dietz III, has run the company. He is aided by his mother, Barbara Dietz, who has been a mainstay at the lab for many years, as his administrative assistant, and Angie Brown, who has worked there since the 1970s. The lab has other longtime employees as well, such as the surface supervisor worked at Dietz Laboratories for 57 years before retiring several years ago.

Some of the lab's customers are just as loyal as the employees. “I've been a customer for over 50 years,” said Edwin M. Pack, OD, who operates a private optometric practice in Fort Worth Worth together with his son Leonard. “They do 99 percent of my Rx work.”

Asked why he has remained a loyal customer for more than half a century, Dr. Pack summed it up succinctly: “They do good work. They back up the product. It's trouble free. They’re very agreeable, and that’s made for a good relationship.”

Paul Taylor of Ben Taylor Optical in Fort Worth has also enjoyed a long, productive relationship with Dietz Laboratories.

“The Dietz family been linked together with my family for some time,” he recalled recently. “Ed (III)'s grandfather hired my father as stock boy many years ago. Then my father worked with Ed. Jr.

“We continue to do business with Dietz Laboratories because their work is always consistent and they are very personable. If we have special needs, they can always help us, such as finding that one odd frame for a customer. Barbara will work tooth and nail to find it anywhere in America. They do good quality work, and you count on it being right.”

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Martin and Olson Acquire Jim's Optical Service—Jim's Optical Service, a full-service optical wholesale laboratory in Modesto, Calif., has been acquired by Ken Martin and Tom Olson, former owners of the Modesto-based lab Martin Optical Service. The purchase price was not disclosed.

Marlite Optical

Ken Martin (left) and Tom Olson (right)

The new owners are renaming the lab Mar-Lite Optical Suppliers, effective Jan. 1. Martin and Olson will share management responsibilities. Martin will be in charge of operations and marketing; Olson will handle sales.

“It is our hope to provide the ECP with the service and quality that they were receiving from Martin Optical Service when we owned the company,” said Martin.

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Fritz Balester of Balester Optical Dies at 85—Fred (Fritz) Balester, former president and chairman of wholesale lab Balester Optical died on  Jan. 13 at the Golden Living Nursing Center in Wilkes-Barre, Pa. He was 85 years old.

Balester Optical

Fred (Fritz) Balester

Balester was born on Dec. 14, 1923, in Wilkes-Barre. He served in the Marine Corps during World War II, and fought in the Pacific, including Guadalcanal and New Britain. After returning from military service, he joined Balester Optical in Wilkes-Barre, which was founded by his father, Fred J. Balester, Sr., in 1934. Initially, Balester was involved in sales. Later in his career served as president and chairman of the board.

Balester's daughter, Heather, currently serves as president of the lab.

Balester is survived by his wife of 62 years, Alison Garland Balester, Kingston, Pa. and Tampa, Fla.; his brother, James W. Balester, Kingston, Pa; five children: Heather Balester, Wilkes-Barre, Pa; Dr. Valerie Balester, College Station, Texas; Jonathan Balester, Shavertown, Pa.; Matthew Balester, Clifton Springs, N.Y.; and Marc Balester, Austin, Texas; eight grand-children; and by seven nieces and nephews.

Memorial donations may be sent to any of the following: The Salvation Army, 729 Sans Souci Highway, Hanover Twp, Pa., 18706; St. Vincent de Paul Soup Kitchen, 39 East Jackson St, Wilkes-Barre Pa., 18701; SPCA of Luzerne County, 524 East Main St, Wilkes-Barre, Pa. 18702.

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Transitions Lab of the Year

Transitions Names Balester, OPL and Soderberg as LOTY Finalists— Transitions Optical has named Balester Optical, Optical Prescription Lab and Soderberg Ophthalmic Services as finalists for the 2008 Transitions Lab of the Year Award. The winner will be announced on Jan. 27 during the 13th Annual Transitions Academy at Disney's Yacht & Beach Club Resort in Orlando Fla.

The Transitions Lab of the Year title has been awarded annually since 1991 and is presented to a Transitions Optical STAR Lab that has made a significant commitment to growing its business with Transitions.

In a related move, Transitions Optical has created a new program to honor former Transitions Lab of the Year winners, the Heritage Lab Ambassadors Club. The program builds upon the perks that are already available through the Transitions STAR Lab Program, and includes providing each of the Heritage labs with an extensive and customized strategic business plan for the year, along with marketing and event access for them and their customers. In addition, future winners of Transitions Lab of the Year award will be automatically inducted into this select Club.

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Tim Fortner

Tim Fortner, left, made a presentation for Transitions Optical. Joining him are host Mark Becker of Precision Optical Products and Greg Rook of Hoya Vision Care.

Lori Treadwell

Co-host Lori Treadwell of Precision Optical Products, left, welcomes Cesar Villanueva, Precision Eyecare and Marla Zupancic of Silhouette Optical.

Terry Yoneda

Terry Yoneda, Younger Optics, left, and Carol Baez of Transitions Optical check out a “hot title” from Magic Mike.

Adam Cherry

Howard Purcell, OD, Jen Walker and Vicki Sobotka of Essilor share a laugh at the Precision Optical event in San Diego.

Precision Optical Offers San Diego ECPs 'View From the Top'—Leading independent ECPs from the San Diego area met with representatives of top optical manufacturers in November to discuss key strategies and proven tactics that could be utilized in helping them succeed in a down economy. What began as an evening of reflection, networking and entertainment hosted by Precision Optical Products, a local independent wholesale lab, evolved into a mini business symposium with discussions involving market trends, best practices, internal/external marketing, resource capitalization and trends forecasting. Set on the 25th floor overlooking the San Diego skyline, the attendees were rewarded with candid presentations by business experts from Transitions, Essilor, Hoya, Pixel Optics, Younger, Silhouette and Stegen Designs.

“Several months ago when the initial planning of the event began, the economy was uncertain and many of our customers were starting to experience early signs of a weakening purchase cycle,” explained Lori Treadwell, vice president and chief financial officer of Precision. “An early indication was an increase in patients wishing to use their old frames instead of making a new frame purchase. There was also a greater interest to receive the exam and wish to look around before deciding to purchase and many patients were beginning to express interest in selecting only what their vision care plan covered. With a reduction in patients, fewer premium enhancements and lower capture rates, our leading customers began questioning what could be done to address the trend. Our exchange with our vendor partners quickly grew into a plan to encourage each company to present their recommendations on what can be done during this soft economy to succeed and how the specific vendor can help. The reception to this approach was extremely positive as we are now working with our customers helping with forming and executing their growth plans. This event revealed a sincere interest in best practice evaluations and how to integrate premium product solutions into patient lifestyle needs.“

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Briot Accura

Briot Form

Digiform Plus Software for Accura Edgers

Manufacturer: Briot USA
Description: Digiform Plus provides Briot’s Accura edgers (Silver, Silver Plus and CX) with the capability to do shape modification for customized jobs. The software also saves frame tracings and virtually an unlimited number of original and modified rimless shapes in the computer's hard drive.
Features: Several shape modifications are available: proportional, which is used to increase/decrease an entire shape proportionately; vertical, which is dedicated to near vision fitting in narrow rimless frames; horizontal, which is used to adapt any rimless frame to wide faces. Shape modification function helps reduce special order situations and gives a unique option for customizing eyeglasses.

Job storage is useful for eliminating a patient's return visit to edge lenses into frames they may be wearing while waiting for their new Rx to arrive from the lab. Frame tracing data is permanently stored and then accessed whenever the lenses are ready to be edged. Pattern storage with Digiform Plus allows for faster, more simplified process when processing all rimless frame styles. Frame shape is stored in a computer database, eliminating need to manually trace each job by removing demo lenses for a pattern and placing them in the tracer. Shape is consistent every time it is pulled from the computer.
(800) 292-7468
www.briot-usa.com

 
iHot Mirror

iHot Mirror

Manufacturer: Chemalux
Description: Heat-resistant mirror sunlens
Features: Withstanding up to 200ºF without crazing, iHot mirror, based on patented nanotechnology materials, can be safely worn and left in hot environments (e.g. summer, car dashboard). iHot offers four flash mirror colors on PC lenses that allows for customer personalization and to meet customer's fashion needs. With heat-resistant AR on the lens backside, iHot mirror AR eliminates backside glare and reflection; providing the wearer superior comfort. iHot possesses super-hydrophobic properties, making it easy-to-clean.
(818) 727-9786

 
DLT Generators

CTO Option for Gerber Coburn DTL Generators

Manufacturer: Gerber Coburn
Description: High-speed, Crib-to-Oval (CTO) option for Diamond Turning Lathe (DTL) generator series, the flagship product of Gerber Coburn’s Performance Series line.
Features: Capable of cribbing all lenses to oval dimensions under 10 seconds per lens. CTO option can be incorporated on existing DTL100, DTL150, and DTL200 units, or can be ordered with the DTL directly from the factory.
(800) 843-1479
www.gerbercoburn.com

 
Multigressiv MyView

Multigressiv MyView

Manufacturer: Rodenstock/Optical Distribution Corp.
Description: Newest generation in Rodenstock's line of optimized progressive lenses.
Features: Using free-form technology, MyView places the entire progressive prescription on the back surface of the lens. In addition, MyView provides a customized inset based on the patient’s monocular PD, which further enhances vision in the intermediate and near zones. MyView also comes in three progressive zone lengths, with a minimum fitting height as low as 14mm.
(888) 407-3937
www.odcvision.com

 
Universal Photonics Universal Photonics

UNI-KP 60 P100 and UNI-KP 60 Twin Z

Manufacturer/Distributor: Universal Photonics
Description: Chilling, filtering and processing systems designed to reduce costs, increase lens quality and deliver environmental compliance.
Features: The UNI-KP 60 P100 (top), a fully automatic centrifuge system for one to two lens generators, is self-cleaning and maintenance-free. With integrated compactor, cooling coil or chiller, 132 gallon tank, and 26 gpm flow rate, the P-100 delivers continual, efficient cleaning. The UNI-KP 60 Twin Z (bottom) offers similar high performance with a compact footprint and two supply pumps for two generators. It will operate on one centrifuge while the other is discharging solids.

(800) 645-7173
www.universalphotonics.com

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In This Edition...
DOLLARS & SENSE
Decision Making:
Tools of the Trade,
Part 1
FOCUS ON…
Paula M. Yetz
of Perferx Optical
NEWS TO USE
Survey Reveals ECPs
Attitudes About
Labs and Lenses
LAB NOTES

Dietz Laboratories
Marks 75 Years
in Business

Martin and Olson
Acquire Jim's Optical
Service

Fritz Balester of
Balester Optical
Dies at 85

Transitions Names
Balester, OPL and
Soderberg as LOTY Finalists

Precision Optical
Offers San Diego
ECPs 'View From
the Top'

OPERATING STRATEGIES
Distinguish Yourself
in a Commodity World
TECH TALK
Layout and
Blocking Tips
check HR CORNER
Finding and Keeping
the Best Employees
check BUSINESS
BUILDERS
The Essentials of a
Successful Business Plan
 

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DAC Vision
 
LabTalk Spotlight
January 2009

The January/February LabTalk cover story asks the question “Is it time to take the leap into digital surfacing?” Author Julie Bos asks industry leaders tough questions about digital surfacing including: What is the return on investment? What are the biggest objections to investing? And can a lab use digital surfacing equipment to make traditional lenses and what would be the advantage of doing so? Check out this excerpt:

When is the right time to invest?
Many believe that time is now. The technology is already proven—and yet still young—so your lab could have a great opportunity to position itself for immediate growth. In fact, some say the availability of digital surfacing technology should cause labs to think twice before purchasing any piece of new, conventional equipment—stating that the older technology is soon to be (if not already) outdated.

Despite these opinions, there are several factors that could guide your purchase decision. You may be ready for digital surfacing today if your lab:

  • Needs to improve yields and/or lower labor costs

  • Wants to automate the surfacing process and create a high-quality lens

  • Has an immediate need for new capacity or equipment replacement

  • Already farms out 30 to 40 pairs of newer, more complex lens designs per day

To read the entire article, “Digital Surfacing—Is it Time to Take the Leap” log on to http://www.labtalkonline.com/. There you will find the article listed under the Features section.

Business Builders

The Essentials of a
Successful Business Plan

“He who fails to plan, plans to fail.” As the economic slowdown shows no signs of letting up, this old adage rings true in today's business world. When it comes to strengthening your business, having a formal plan in place can be the key to surviving and thriving during this downturn.

What exactly are some of the strategies to consider when writing a successful business plan? Writing a business plan is not just for an entrepreneur with a start-up business dream. You may find your business or company in a position of improvement or expansion, and the plan may be used to woo creditors and investors, define a new business, provide course correction or simply evaluate a new product line. The plan also may be used by leadership to clearly define the business and strategy and create a roadmap to a successful enterprise.

After determining your purpose, write the plan with your audience in mind. Will your plan be used internally or externally? External plans are generally start-up plans, growth or expansion plans or new product plans where financial capital is needed.

A financial history is most important to banks, while investors look more closely at the description of management. These plans must meet their needs and earn their respect. Internal plans, such as those designed to investigate a new product line, may be more operationally focused than financially focused and are written strictly for management.

There is no single outline because each plan has different goals. Generally, a plan has a standard set of components, including an executive summary, company description, product or service description, market analysis and marketing plans, management team description, financial analysis and operations plan.

Business planning is about results. Get results, not just by completing the outline, but by ensuring that the contents meet the purpose of the plan and focus on details of the whole process. Don’t waste time creating a plan that you will not follow.

Successful implementation starts with a good plan. The model is more likely to be implemented successfully by sticking to simple, specific, clear and realistic elements. Use general management principles and processes and define strategy, realistic and measurable goals, actions, timelines, responsibilities, budgets and plan reviews. Finally, the plan should cover all areas and try to eliminate the unknowns.

Use software resources, books and Web sites such
as Small Business Administration. Review plenty of samples. Do the initial work, but there is nothing wrong with obtaining the professional help of a business consultant to refine the business plan, especially if it is an external document or large undertaking. —Hedley Lawson, Jr.