Business breakdown part III This is the final installment of a multi-part case study on Starbucks Corp. We previously covered the business model, profit model, unit economics, and financial statement analysis (links below). ​(Part I) Business model and unit economics​ ​(Part II) Financial st...

Last week, we kicked off a multi-post series working through a case study, Starbucks Corp. to be precise. We covered the business model, profit model, and unit economics and today we're moving onto financial statement analysis. (Part I) Business model and unit economics (Part II) Financial st...

Big Picture Thinking Can you give a quick and straightforward answer to questions like: What are you working on this week/month/year? What is your business model or profit model? What are your goals for the next 2-3 years? If you’re anything like most business owners I know (myself inclu...

Seeking help Ever feel like running a business is a lonely endeavor? When starting or running a business, going it alone certainly allows for more control but comes at the expense of added stress. I've heard some experts say that every business owner should have a coach, or mentor, or some othe...

Sources & uses of cash This is Part 2 of a series on capital allocation. A quick recap from last week: We defined the 3 uses of profits as capital allocation. They are: Buy more assets (with the intention of growing sales) Pay off debt and other liabilities Pay dividends to owners Where ...

In any business (that's any industry, any size, any product), there are generally only 3 ways to use profits: Buy more assets (with the intention of growing sales) Pay off debt and other liabilities Pay dividends to owners Most finance pros refer to this mix of profit usage as capital all...

How do you know whether you have enough cash in your bank account? This is a common question in both business and personal finance. My guess is you're taking one of the following approaches: A random amount of money that "feels" right Don't think about it until you realize it's time to run pa...

With Labor Day promotions behind us, it feels like a good time to talk about the financial impact from discounts, promotions, and marketing campaigns on your business. It goes something like this: We want to get rid of slow-moving inventory, how about a 30% off sale? Sign up for our email ne...

Use visuals to spot trends and patterns There are only 3 ways to convey information: Words Pictures Numbers If we rank them from easiest-to-hardest-to-understand, then it probably goes: 1) pictures, 2) words, 3) numbers. So why are we exclusively using numbers to understand our financial...

I'm tired of seeing crummy articles about building a budget, forecast, model, etc. so I decided to create this incredibly simple yet practical guide to budgeting. [In case you didn't pick it up, I use the terms budget, forecast, and model interchangeably.] What are the steps? You likely already...