If I were to "drop in" on your business today, could you tell me how things are going this week?
Most business owners don't have a formal tool or process for monitoring early warning signs (both good warnings and bad warnings). These "tools" go by many names: KPIs, scorecard, dashboard, balanced sc...
You need a good set of books. Period.
When working with a new client, I typically start with 2 questions:
- Are you consistently getting financials reports on a timely basis?
- Do you believe the numbers you're looking at (i.e. are they reliable)?
Don't worry if you answered "no" to either quest...
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 alloca...
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 payro...
When it comes to managing a business, there are typically 2 schools of thought with staunch defenders on each side:
- Delegation
- Hands-on management
(The latter is sometimes referred to as micromanagement.)
In his recent article Founder Mode, Paul Graham (founder of startup incubator, Y Combin...
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 newsl...
Most business owners have a loose idea of their unit economics (margin at the product level), but it's usually:
- Stuck in their head; and
- Crude back-of-the-napkin math.
Your pricing strategy can make or break profitability... generally, I see companies fall into 2 buckets: those with revenue o...
We've covered working capital a few times in the past...
- 101 – What is working capital
- 201 – Working capital drivers
- 301 – Optimizing & analyzing working capital
But today we're covering probably the all-time most useful ratio when it comes to managing working capital... the Cash Conversi...
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