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2015: The Factor’s Guide to Strategic Planning

January 06, 2015, 07:00 AM

As we enter 2015, it’s important to reflect on our various industry trends to see where our space is going and how we will be affected going into the New Year. With the advent of more and more players in our industry — many of whom want to “disrupt” our business — and generally a much healthier economy, we are all seeing pricing pressure and heightened competition.  With the increased focus on lending to SMEs, it is very apparent that now is the time for factoring and asset based lending companies to create a strategic plan for their businesses.

Change the conversation away from price and focus on delivering value to the business owner.

If you believe price is the most important consideration in a purchasing decision, then take a look at any number of personal items you purchase on a daily basis. There are many examples of name brand items that are not cheap yet all of us consume them due to our positive feelings about the brand itself. (iPhone, anyone?)

The way to differentiate ourselves is to appeal to the emotional reasons why the business owner is in business in the first place. To do this, we have to ask better questions of our prospects in the interview process.  We must recognize that delivering success to our clients is the ultimate marketing strategy and the ultimate client retention policy.

Find your inspiration with S.M.A.R.T. goals and your purpose driven mission.

The professionals in the factoring and asset-based lending industry are some of the scrappiest, most interesting, fun and motivated people I’ve ever met. We are truly one of a kind, and I’m so blessed to have been in this industry for 20 years.  That being said, we all need to be reminded of what we are working for and why we get up every morning.  At Far West Capital, 100% of the employees share their S.M.A.R.T. goals with the entire company in a transparent way and report on progress on a weekly basis. 

S = Specific
M = Measureable
A = Actionable
R = Realistic
T = Time bound

This keeps everyone focused on the big picture along with the specifics that will make the goals more attainable.

As mentioned above, if your focus as a company is to help your clients succeed, just think of all of the social good that you are helping to provide: vendors supported; taxes paid; retirements provided; families fed; and dreams realized. The collective impact you have on a daily basis is huge – it is a very inspiring aspect to focus on when you wake up everyday.  If you are in leadership (hint: everyone is), remind those around you, on a regular basis, of the way in which you are helping to change lives.

Keep taking risks and learning lessons.

Yes, problems arise. Yes, we are in an industry of risks. Yes, you have a choice in how you respond to issues and problems. But how you respond is where the gold is for your company.  Create a culture that supports empowerment and collaboration – where decision-making authority is delegated as close to the client as absolutely possible.  When a “situation” occurs, there is an opportunity for the team, to either slow down and learn, or gloss over and blame.  Recognize there are no excuses for losses; you are always at cause, and if you focus on what you can control — your behaviors, actions, and attitudes — you are always in a position of power.  This business requires an extreme amount of daily discipline and situational awareness, so create an environment that celebrates “learning opportunities” and does not punish mistakes.

The learning never stops. We’ve heard it said that smart people make mistakes, but never the same one twice.  Lead your organization towards doing right by the team and right by your clients. Then, the issues become minimal  — because you get what you give, and when you strive for client success, your own success is inevitable.

Cole Harmonson
Co-Founder, President & CEO | Far West Capital
Cole Harmonson is the CEO and co-founder of Far West Capital. After his employer sold their banking business in 2007, Hormonson took the leap into entrepreneurship and started Far West Capital. Growing up in Texas with an entrepreneur father taught him valuable lessons about business, family, and taking care of people. These core values drive the mission of Far West Capital to unleash the potential inside of every business.

Just nine years later, Far West Capital has provided more than $3 billion in financing to growing companies across the country, and its Far Reaching campaign donates over $100,000 to charity annually. Harmonson and his wife Kristi live in Austin, Texas with their dog, Brodie.
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