Stay plugged in! (...or wireless)

We're trying something new for this cycle! We're elevating our online presence by keeping you posted through facebook and this blog!

Every week, you'll find program news and, as the training sessions get started, you'll be able to find recaps, anecdotes and exercise solutions right here.

Another way that we're using the internet to make the Chinook Entrepreneur Challenge easy and fun for the user is by offering the training session live streaming every Wednesday evening in February and March through Justin.tv.

You'll also be able to find vignettes of the training session linked to a youtube account right here!!

Be sure to check www.chinookchallenge.com , this blog and on facebook regularly for updates!

2011 Sponsors

We are so thrilled to be welcoming back many of our partners from the past years and to be joined by new partners!

This upcoming cycle of the Chinook Entrepreneur Challenge is set to launch January 3, 2011. Visit www.chinookchallenge.com to get more information and visit back regularly as the site and this blog will be updated regularly until the Awards Ceremony on June 9, 2011.

Let's take this opportunity to thank our sponsors!





If you're interested in reaching new businesses while they're in their development stages, want to support this program or economic development in southern Alberta, please contact our office at (403) 320-6044 or info@chinookchallenge.com.

And the winner is...

INSPECTACAR INC.

What a wonderfully exciting day on Friday!
All morning, we heard business presentations from the finalists: InspectaCAR inc, Sugar Dreams and CPR Engineer's House.
Each presenter had great appeal and were very familiar with their product and how they would use the prize.
All businesses showed great potential and sustainability, but the winner really shone.

After the morning business presentations, we were joined by our sponsors, partners and friends at Country Kitchen Catering.
It was so great to hear from our past winners Kerry Weiland of Titan Welding, Wardlow, AB, and Brett White of Bridge Land & Energy Services, Lethbridge, AB.
Both commented on the importance of business planning, but also warned about being prepared to adapt as circumstances change ...and they will change.

Congratulations to all of our finalists: CPR Engineer's House, Sugar Dreams and InspectaCAR inc.
Here are a few other pics from the day:

Our mascot!
To be an entrepreneur, you have to be a lot like this little fellow. You have to be flexible and able to adapt to changes. You have reflect what others need from you. But entrepreneurs are also balanced & maybe, a little hard-headed. CEC is here to support & usher innovation, to help turn ideas into actions.












The InspectaCAR smart car is an example of their polished branding and new twist to approaching the market. Keep your eye open for this "bug" and congratulate them on their CEC win!!

Of course, Sugar Dreams brought lots of samples of their exquisite sugar sculpting and pastry delicacies! Such detail, what talent!!

CPR Engineer's House is steeped in regional history and now it's the exciting location of Brooks' newest tourist destination and special events venue. Here a picture of the Engineer's House in 1911.
Stop by on your way through this convenient community and see the hard work and dedication these entrepreneurs have put in!
Good luck on an exciting summer ahead!

FINALISTS ANNOUNCED!!

You can't believe the excitement mount as the final scoresheets rolled in.
The competition was so tight and came down to meer points but, thanks to the help of our volunteer screeners, we've determined the 3 top-scored plans.

Please join the Chinook Entrepreneur Challenge Organizing Committee in congratulating our 2010 Finalists:

CPR ENGINEER'S HOUSE (Duchess, AB)

INSPECTACAR (Lethbridge, AB)

SUGAR DREAMS (Magrath, AB)

Twenty-two plans were received and showed entrepreneurial spirit. We encourage all inspired competitors to contact their host Community Futures office to explore options to further your endeavour. Community Futures can offer business consultation, training and loans.
Local Community Futures offices are:

- Community Futures Alberta Southwest (659 Main Street, Pincher Creek, AB T0K 1W0, (403) 627-3020)

- Community Futures Chinook (5324 - 48 Avenue, Taber, AB T1G 1S2, (403) 223-2984)

- Community Futures Entre-Corp (#202, 556 - 4th Street SE, Medicine Hat, AB T1A 0K8, (403) 528-2824)

- Community Futures Lethbridge Region (2626 South Parkside Drive, Lethbridge, AB T1K 0C4, (403) 320-6044)

- Community Futures Meridian Region (125 - First Avenue East, Kindersley, SK S0L 1S0, (306)463-1850)

- Community Futures Wild Rose (101, 331 - Third Avenue, Box 2159, Strathmore, AB T1P 1K2, (403) 934-6488)


I sincerely hope you all pursue your ambitions. There was only 23 points variance between the top 50% of the plans submitted which means the competition was very tight and every business plan shows promise!

ATTENTION ALL 2010 PARTICIPANTS: Regardless of your level of participation in this year's Chinook Entrepreneur Challenge, you are welcome to register again next year. You'll be the first notified when registration opens. Several participants return for a sophomore cycle and their business idea strengthens at every turn.

Stay tuned for the winner to be announced June 11!
Congratulations again finalists!

Competition Closed

The 6th Annual Chinook Entrepreneur Challenge is now closed!

I am thrilled to say that we received a whopping 22 plans, including 2 promising submissions for the Youth Technopreneurship Program.

Going over the plans for the past two days, I want to offer a huge CONGRATULATIONS and GOOD LUCK to each and every competitor.

Each plan is inspiring and has enormous potential. Regardless of the competition outcome, each business plan received took great thought from the individual/team and we can't wait to see the outcome.

Great work all!!

More on cash flow (recap of session 6 at session 7)

Understanding cash flow can be very complex. Since we didn’t have much time in the previous session to discuss it, that’s how we started this week’s session.
Remembering the other two primary financial statements are balance sheets and income statements, the cash flow statement will tell you whether you’re ok, how to manage the flow of funds as payables and receivables cycle.
There are a few things you may hear when talking finance. Profitability discusses return, activity discusses the management’s ability but solvency may be trickier, it comes up when asking whether you have enough cash/receivables to pay outstanding bills/payables.
Changes in cash flow can happen in three areas: financing, investing and operations. Most changes will be to your operations but it’s important to calculate the other areas.
When setting up your cashflow statement, you’ll chart the months by inflows and outflows (you may need to look at weekly or quarterly planning depending on your business).
Craig explained that you may want to do a month “0” so you can include the costs associated before you even open the doors (ie. insurance, deposits, etc).
To help control flow, you’ll want to concentrate on bringing in money quickly and delay payments when possible. That doesn’t necessarily mean you want to go over 30 days on payments, but you may want to keep in mind that if there’s not an incentive to pay early and you know there will be inflows in the next day or two, a delay may be a good idea.
Once you’ve prepared you cashflow statement, you might notice some months are negative. Seeing that, you might be first concerned, but then you should feel relieved because at least you know about it ahead of time and can compensate or manage through. To get through, you may have to sell some old equipment, look at how to increase sales without incurring further unmanageable outflows, or use personal or family funds.
Craig also mentioned that you may consider a working capital loan. A few weeks ago, Randy Helm from Servus Credit Union was in talking about the same thing. If you are seeking money for a specific thing (like an expansion or a large project), it may be easier to access some funding.
“A business may have good sales, but it could still have cash flow problems,” Craig said. “If you know up front, you can manage them.”
You’re probably wondering when does your business become profitable? That’s your break even point (the point where you break even, lol).
There a couple of ways to look at this. The formula: BEP=total fixed costs/(selling price-variable costs). The chart:

-

(sorry for the notey-crudiness)
At this point, there was a question from the participants asking “what if you’re selling various products at different price points?” You can try taking an average; create a dynamic formula; ask an accountant; come to the April 7 session to get some one-on-one advice. It can really depend, but overall keep your fixed costs low.

session 6: using financial statements

Since we hadn’t completely wrapped the previous session and it lead directly into what we were talking about this week, a recap was welcomed.
This is the magic formula:
A = L + (C-W) + (R-E)
or
Assets = Liabilities + (capital-withdrawals) + (revenue-expenses)
. EQUITY
Operators Equity is the worth of the company.
Liabilities is debt owed.
Do recall double entry accounting? With this formula, when entering something you must enter a complimentary, counter entry so everything stays balanced.

When analyzing financials, there are three statement types based on what information you require.
When asking “what’s it worth?” You need a balance sheet.
When asking “are we making money?” You need an income statement.
When asking “are we ok?” You need an cash flow statement.

The balance sheet is always dated. It represents a point in time reflecting the accounting formula above.
You’ll list your assets and total. Next, list your liabilities and total. Then, list your capital and retained earnings. What’s the total?

The income statement is over a period of time, like the past year. It’s also known as the profit/loss statement. This is where you list your revenue and expenses to calculate your income (which should compare to your retained earning on the balance sheet).
To take it a step further, an income statement may also include sales minus cost of goods (COGS) to give gross profits, then subtract operating expenses.

Maybe this sketch can help…













Cash flow statement is totally different. It looks at how much money is coming in when.
For an exercise in cash flow, click here.

Here's a tip: Always keep your columns lined up, right aligned.

We'll be covering more about cash flow at the beginning of the next session.

Mark Switzer

Before the instruction started Wednesday evening, we had the honour of hearing from Mark Switzer.

Mark is a Lethbridge entrepreneur who has been operating in the region for 30 years. In 1999, he got involved with the Community Futures Lethbridge Region board of directors. By 2001, he was Chair.

He told us about the business planning process and offered lots of tips for budding entrepreneurs and community members.

First thing he mentioned is that “you’re never really NOT at work”. If you aren’t interested in work 60 hours of a week, you’re probably better off to find a job working for someone else because that’s the level of dedication you need to see a successful business through.

He said that if you can find investors from your family, that is a good direction to pursue. Not only is it just a secure funding method, but it’s an added level of accountability.

He suggested three key things: Rent before you own; Lease before you buy; Work before you hire.

Mark added that you must be secure before you expand. For example, when considering a second location, analyze the impact of dividing your time and double the overhead. Often, new expansions creates competition for the original location.

Which lead to his following point: diversify only if you know the risk.

Mark emphasized that business owners need to investigate their partners. Not only investing partners, but also suppliers, vendors, agents, etc.

In business, there’s one group you ALWAYS PAY FIRST: the government. Between taxes, monthly remittances, MERB, etc, you’ll have statutory obligations. If you fail to follow through on those obligations, the Canadian Revenue Agency can seize your bank accounts, your assets, your home until they get sufficient recompense. Mark also said that you must include yourself on the payroll, even if you’re not getting paid because you’ve spent all your money to pay the government. Audits can happen to you.

Then Mr. Switzer gave us a few ideas for once we are successful.

He urged participants to reinvest in the community. When you start a business, the expectation is that you’ll be taking money out of the community, so you really should be putting back too. This creates a familial relationship which (especially in southern Alberta) can be the best advertising and will spread.

Keep your spouse/partner informed. If they know there are cycles, they also can be prepared and plan ahead. It’s also really helpful to have someone you trust that you can bounce ideas off of.

Praise your staff. Contrary to old-fashioned management philosophies, a militant environment will only add pressure to your business. Instead, coach your staff. Try saying things like “I see this…, but let’s try…” and NEVER criticize in front of others. You may not realize it, but word-of-mouth is a very powerful tool that your employees have first access to. You need your staff to come back so empower them and let them manage their specialties. He added that, now with technology, there are very few circumstances where you will not still be the ultimate decision-maker.

Mr. Switzer wrapped up by saying that he’s found incredible value in being a community mentor. He said that it’s better if you can know things ahead, so share and help inform others. Make your experiences available and be around others who do the same.

He warned “don’t get over involved”. Mark shared his criteria for volunteering. He explains the opportunity must allow for elements of the following components: education, travel, network, and stipend. He explained that after years of service, this is how he narrows down (otherwise there just wouldn’t be time to enjoy home, family, the good stuff).

Thank you Mr. Switzer, see you at the Awards Ceremony!

session 5: finance 101

Session 5: Finance 101
The accounting basics, financial statements made easy

Randy Helm from Servus Credit Union came by and spoke about small business finance.

A great website to check out for business financing/ loans through the government is www.strategis.ic.gc.ca. Look for the Canada small business financing program link on the right hand side of the page. Find out how and where to apply for a CSBF loan. Eligible small businesses for the CSBF program.

3 types of banks in Alberta.
1. Chartered banks, banks like TD, CIBC, big banks. Goal is to satisfy majority share holders.
2. ATB Financial- Government owned, positioned in small communities throughout the province, (Taber, Picture Butte, Magrath) Grassroots.
3. Credit Union- Co-op principles, profit sharing,

Register at a corporate registry for your company name.

Better to go with a corporation right off the bat than do a joint partnership because of the security you can get through legal protections.

CRAIG-
Craig first explained the three basic accounting terms, what they mean/stand for when broken down.
ASSETS
• Something of value. –property owned, or a building
• Current asset (cash, car)
• Accounts receivable –money owed by Ex: renters,
• Inventory –items in store, stock on shelves, already purchased
• Prepaids?- Having already paid for car insurance, or rent, or a car payment before it was due.

LIABILITY
• Debt owed- anything, bills, money owed that needs to be paid
• Current liabilities- phone bill, internet bill, etc..
• Accounts payable- similar to current liabilities, money owed
• Long term liabilities-

EQUITY
• The worth- overall worth of the company.
• Original money invested
• Plus any profits
• Not cash!!


PRACTICE

DOUBLE ENTRY SYSTEM
Asset = liabilities + equity
• ALWAYS two entries (at least)
• Keep the equation balanced



Investing $$ = Financing $$

Investing $$ = DEBT + EQUITY

Stuff = Owe + own

Asset = liabilities + equity



Amortization = depreciation on equity/inventory over time. Ex: A computer that costs $1000 dollars in 1998 doesn’t cost $1000 in 2010.

Assets = Liabilities + (plus) Owners Equity
Capital – (minus) Withdrawals + Revenue – (minus) Expenses

Assets= L + (C-W + R-E)

The main thing to remember about this equation is the double entry system. You must always keep the equation balanced on both sides of the equal sign.

Helpful Links

At last night's session, the group heard from Randy Helm from Servus Credit Union.
He told us about financing options and mentioned the Industry Canada's Small Business Financing Program, where the Government of Canada will support entrepreneurs by guaranteeing loans with banks, credit unions or treasury branches for up to 90% of costs on equipment, leasehold improvements, etc.
Here's the link:
http://www.ic.gc.ca/eic/site/csbfp-pfpec.nsf/eng/Home


To contact Randy:
Servus Credit Union Ltd.
Randy Helm
Senior Commercial Account Manager
480 Scenic Drive South,Lethbridge, Ab. T1J 4S3
T: 403.331.6518 Ext 6176
F: 403.329.6069
randy.helm@servus.ca


----------------------------------

session 4: marketing you idea (part 2)

To target a market, first we categorize (segment) then go after (position). To segment a market, there are variable to consider:
- Geographic (ie. selling umbrellas in Arizona)
- Demographic (age, income, # of kids, gender, education, etc)
- Psychological (opinions, interests; changeable depending on marketing ie. diamonds, Burberry, Lexus)
- Product Use (common, ie. shoes, minivans)

To analyze this, Craig explained the segment chart:
- imagine 2 intersecting axis
- plot the market
- identify where you’ll position yourself


Craig also explained the Product (and services) Life Cycle. Through the introductory stage, you’ll spend time teaching the benefits of your business and raising awareness. Sales start to take-off and this is the growth period, you’ll notice competition start to pop up through this stage as well. As your business matures sales will slow but profits are high. Then comes decline, where sales and profits start to drop and promotional dollars start getting cut. Ultimately, you want to tapper the decline stage.
The Life Cycle can be visualized in a graph:

Once you’ve given some thought to who your customer is, start looking at the 4Ps: Product, Price, Place and Promotion. All intertwined elements to a sound marketing plan.
Product (or service) is where you really want to differentiate yourself within the market. A very important element where you can make that crucial first impression, but don’t get carried away. An example of this is perfume, where you need to say everything about your product without actually experiencing it – based on design and packaging. This is a chance to really appeal to the customer’s emotional side.
Price is a difficult concept to master. You don’t want to undervalue yourself, but it won’t take your customers long to realize that you overcharge either. You can do trial rates, matching or other promotions. There’s also the psychological aspects like charging $4.99 instead of $5.
Promotions are the more obvious elements of the marketing plan. Consider four types of promotion: advertising, personal selling, sales promotion and public relations.
Advertising is any form of paid promotion. TV, radio, newspaper are the default advertising, but there’s a world of opportunities out there. Consider sports events, maps, tourism or sponsoring the Chinook Entrepreneur Challenge.
Personal selling may be cliché, but word-of-mouth is a hugely important and influential means of promotion, not to mention a great chance to practice your presenting skills and your enthusiasm will come through. You can look at upselling or listing specials to clients as personal selling techniques too.
Public relations are anything you to build goodwill in the community, and likely you haven’t paid for it. (ie. Tim Hortons Tim Bits Hockey)]
THINK OF MARKETING BEYOND ADVERTISING
(but at the end of the day it must benefit the company)
Finally, Place. How are you going to get your product into the consumer’s hands? Or how will you get them in the front door of your business? You really need to look at who your customer is…not necessarily your consumer. For example, Proctor & Gamble’s customer is Wal-Mart and London Drugs, not you and I (we’re the consumer).

Next week’s session is Finance 101. See you then!

New Dork!!

Saw this clip and made me think of some of those entrepreneurs out there!

http://www.jokeroo.com/videos/funny/entrepreneur-state-of-mind.html

session 4: marketing you idea (part 1)

This session was one I was looking forward to.
Marketing your ideas.

But before we could start that, Craig laid out some corporate structures.
There are three ways you could look at building your company, and advantages and disadvantages to each.

Sole proprietorship is like a kid with a shovel, who decides to start clearing snow. This is the easiest way to get started and you claim it on your personal income tax as additional earnings. But if Mrs. Jones slips, she could sue the kid and take him for his skateboard, hoodie, mp3 player, dog, everything. Disadvantage.

Partnerships are similar, but you "partner" up next to others with same liabilities and tax benefits. Be cautious because you could also end up with a huge bill.

Corporations are a lone legal entity. Taxation changes (doubles) but you can raise more money (equity options, shares), and the company is liable, not you.

All that said, you should still ask yourself "why not incorporate?"

We capped that off with a corporate governance slide. It's likely you (the entrepreneur) will hold most/all of the positions (shareholders-board of directors-senior managers).

TARGET MARKET TYPES
It's not fair to you or your customers to say "my market is the world." Businesses spend millions of dollars researching who their customer is and how to talk to them.

To narrow down your target market, start with consumer, industrial or export markets.
Consumer markets are value-driven and emotional. It's the most frequently sought market. Industrial markets should be overlooked, you may be able to sell to companies, institutions or government. It's a more rational market but look more carefully at price, dependability and quality. Export markets aren't as visible but obvious for some businesses. Craig gave the example of a collectibles shop, a small fraction of the total sales may happen through the foot traffic, while most transactions were sold online and shipped.

Session handouts

After some technical difficulties, some of you may not have received the handouts from last night's session.
You should be able to find all the information discussed (including the powerpoint presentation) at http://www.chinookchallenge.com/seminar.php

Please note, these materials will only be available until April 30.

session 3: financing or funding

When it comes to finance, many entrepreneurs may shy away. The technical aspects of accounting may be beyond your realm of expertise, but all new business owners have to acknowledge and understand the basics for their business to thrive.

The first question Craig posed to the group last night was "how much money do I need?" He cautioned against underestimating this amount and this is a huge planning failure.

When writing your business plan, addressing finances could be incorporated throughout. You may even want to discuss it in the executive summary or offering.

Next we discussed debt versus equity. Debt is money you borrow, equity is your retained earnings.
There are many characteristics to debt: secured/unsecured, short-/long-term, variable/fixed rates, etc.

Craig told the group that when you're trying to get money from a bank, they aren't necessarily looking for someone to pay the money back "right away". Banks are more interested in hearing that you can service the debt and support the payments regularly (that's how banks make their money, and that's what they love to hear).

We talked about different sources of financing. You may have options within your own portfolio like savings, home equity, lines of credit, or friends and family sources ("love money"). Entrepreneurs are encouraged to talk to family and friends about their business idea, it's a great way to practice and source some funds but make sure that you're clear on the expectations of both parties - dot the I's and cross the T's.
Venture capital and angel investors are options as well. Venture capital is typically technology-driven, they look for a quicker return on investment but there are social venture groups out there who look to improve the environment or society. Angels are harder to come by. These are wealthy groups or individuals who can come in and take an active role in the early stages, but be aware Angel investors are rare and there are a lot of scams out there. The best way to meet these people is through networking – join Chambers of Commerce, make contacts, find them face-to-face. These opportunities can fluctuate with industries and markets.
The last two options we reviewed were incubators and government. Incubators aren’t considered financial investment but can result money saved. It’s generally a shared space to help new businesses grow, but after a couple of years you are expected to move on to make room for new enterprise.
Government provides a few options. There are lending services like Community Futures, Business Development Bank of Canada, etc, and there are grants. The lending services are an excellent option if you are not a “desirable” candidate with the banks or have other circumstances. Grants are rare, lengthy and highly competitive, however they can be hugely beneficial. There’s more information available at http://www.cflethbridge.com/faq.php (scroll down partly to “Government Grants”).

Then we were on to Presenting. Another aspect you may shy away. No fear. The key to making a great presentation is knowledge and LOTS of practice.
Craig offered great tips. He said keep it simple, 1-3 (max. 5) points that you want to get across. Go with a standard format – intro, body, and conclusion. Think about it as romancing the listener into your concept. Keep track of transitions, which could be as simple as putting a page-turning break in your notes. Be prepared. Tie everything in together, a common theme. And don’t forget to enjoy the moment – you’re enthusiasm and confidence will shine through.
Craig also noted the energy-time graph where, as the presenter you want to get the energy up as high as you can early in the presentation and try to sustain without losing the interest of the audience.

HOMEWORK: practice the elevator pitch. As hard as it may be, think of how you would talk about your business as though you only had the time you’d spend in an elevator.

At this point, I'm sure most participants have a business idea in mind. I encourage you to start developing your business plan – even if it's as simple as starting a document on your computer or a file on your desk.

MENTORS
All of those who requested mentors please watch for a brief questionnaire. (The deadline has passed to request a mentor).

session 2: ideas to action

Now the fun starts!
After recapping last week's session, Craig took us through some of the first steps to ensure we give lots of thought to the foundation of our business.

First thing to do when developing a business idea is WRITE IT DOWN!
You will likely revisit these thoughts to develop concise strategies to attaining your goal.

Once you've assessed your competitive advantages, take time to do a SWOT analysis. Write a list to see what internal forces you have (STRENGTHS, WEAKNESSES) and external forces (OPPORTUNITIES, THREATS).
If you get stumped, Craig said to think of P.E.S.T: political, economical, social, technological.

We discussed S.M.A.R.T., crisp, clear objectives. He encourages us to use specific words and use focused goals.

Craig gave the group ideas of how to get market research. With technology, it's so simple to get the data firms need to make accurate judgments.

With the right data, calculating revenue (which is different than income, as income is the money left after expenses), market potential and market share becomes about numbers.

This is when we got out the calculators. To see a copy of the exercise and the answer key, visit www.chinookchallenge.com

No session next week

Feb. 24 - session 3: financing vs. funding
Definitely bring your calculator for that!

See you next session!

First session

What a fantastic turn-out to last night's introduction session. The room was literally overflowing in Lethbridge, and we had great attendance in Medicine Hat and Strathmore.
Hopefully for next session, we'll be adding two more locations.

We talked about a few items in the handbook, specifically the program overview, eligibility, evaluation process and some of the rules. The prize is $15,000 for CEC and $20,000 for YTP, plus

Craig, the CEC instructor, discussed who an entrepreneur is, evaluating business opportunity and elements of the business plan (here's a tip: write your executive summary, you'll be able to write your enthusiasm and overall vision right in).

CEC is open to teams and individuals. This is a great time to start thinking about support network. If participants are interested, we can match you with mentors. Let Desiree know by Feb. 24 if you're interested.

Next week's session is 'Ideas to Action'. We'll be discussing spotting opportunities, feasibility analysis, creating a competitive advantage and getting things done - BRING A CALCULATOR!

It's not too late to register and take in some great FREE training!

www.chinookchallenge.com

Got questions? Post them here, you probably aren't the only person wondering what you're wondering.

farm.tv

Check out farm.tv for a great interview with Darlene Sinclair (General Manager of Community Futures Lethbridge Region, lead organizers of Chinook Entrepreneur Challenge).



http://farm.tv/videos/originals/chinook-entrepreneur-challenge-1/

Register Now!

Happy New Year Chinookers!
We are so thrilled to be announcing the SIXTH ANNUAL CHINOOK ENTREPRENEUR CHALLENGE.
This year promises to be very exciting with the addition of the Youth Technopreneurship Program and a streamlined evaluation, designed to give participants the most best feedback.

Please take a minute to register now at www.chinookchallenge.com