Written By Joey Perry, vice president and relationship manager, Washington Trust Bank
Every business owner from Sandpoint to Lava Hot Springs has complex financial needs that require expertise across multiple disciplines, but no one can be an expert at everything. That’s the value of assembling a team of advisors. Beyond providing professional assistance with specific business needs, a team of advisors can offer insights into your industry and the larger economy based on what they’re seeing with other clients, and they can provide unbiased counsel on strategies that will help set you and your company up for long-term growth.
Following are some key advisors to include on your team:
• Legal counsel. For most business owners, an attorney is perhaps the first external advisor that comes to mind. If you’re just starting out, you’ll likely have questions about how to best structure your company with an eye toward federal and state tax law. And unless you’re a lawyer yourself, you’ll probably want someone to review contracts. You may need counsel on trademark and intellectual property issues, and you might have industry-specific regulations to consider. Plus, you’ll want to establish a relationship with someone who can help protect your company from potential lawsuits before they arise.
• Banker. Bankers hold the keys to financing, but they can also provide guidance on a wide range of issues and decisions that have financial implications. For example, your banker can help you determine what your business is worth, plan for an exit or ownership transfer, and understand how to translate your business into wealth, as well as providing assistance with tax planning, insurance planning and shareholder agreements. Even if you don’t foresee needing a loan in the near future, take the time to get to know your banker. It’s two-way exchange of value: your banker wants to understand your business and your priorities, as this will help improve the bank’s service offerings, both for you and for other customers.
• Accountant. A CPA can offer valuable guidance on structuring your business as well as providing ongoing tax advice. Your CPA may also offer broader business management counsel, assistance with business plan development, and recommendations on accounting and payroll systems.
• Insurance broker or agent. It’s true that you can buy many types of insurance online, but a local licensed insurance agent or broker can help you assess the risks your business faces in order to determine what types of insurance you need (liability, property and casualty, commercial auto, business interruption, etc.), and can then help you sort through the many policy options to identify which ones are the best fit for your company. If you later need to file a claim, your agent or broker can advocate for you and advise you on whether the settlement amount is reasonable.
• Marketing advisor. Depending on your industry and your growth objectives, you may want to build a relationship with a marketing consultant as well. A marketing advisor can help you develop a marketing plan (which you can then execute yourself if you have the internal resources) and can provide counsel on which marketing tools and tactics are likely to be most effective in reaching your target audience.
• Technology consultant. A consultant who is more than simply a product vendor or help desk provider can make sure your technology resources are aligned with your business processes. Technology is a critical component of most business operations today, and having an objective advisor to help guide your investment decisions can pay off by enabling you to maximize your productivity and position your company to take advantage of new opportunities.
All these advisors can have a big impact on the success of your business, so choose them carefully. Of course you’ll want people who understand your business and industry, but, importantly, who understand the Idaho business community. Ask for recommendations from members of your local business network, research the individuals online and check references. (Once you have the first advisors on board, it’s highly likely that they will know other local experts to recommend.)
In addition to the advisors focusing on your company, you also need someone who can work with the above experts to provide counsel on the impact of your business finances on your personal financial planning. As a business owner, it’s likely to have the majority of your assets tied up in your company, and this will need to be taken into account in your tax, retirement and estate planning as well as general wealth management. A good financial advisor can help to guide conversations around business leadership transition as retirement approaches. Without a clear transition plan in place, it’s very difficult for an individual to preserve their wealth and for a company to navigate the best way forward. Getting your personal wealth advisor on the same page with your advisory team will ensure that you protect the equity and personal wealth you’ve grown with your organization.
That’s why it is crucial to take a few simple steps to create a collaborative spirit among your team. Without clear lines of communication, it’s possible for situations to evolve and priorities to shift. I’ve seen critical decisions made at Idaho companies without the input of key individuals with important information, resulting in significant loss of wealth. Require that members of your advisory team communicate with one another, reducing the time you ultimately devote to financial decisions. This will enable you to make better decisions, and keep you on track to meet both your business planning goals and your personal financial goals.
Joey Perry, vice president and relationship manager
With over 25 years of experience in private banking, small business banking and commercial lending in the Treasure Valley, Joey provides sound advice about a variety of financial services to new and existing clients. She helps her clients meet their financial goals by putting together customized loan packages and solutions that are tailored to fit their needs. Joey also maintains a strong commitment and involvement with community organizations throughout the Treasure Valley.
Washington Trust Bank