The COVID-19 global pandemic is a wake-up call to ALL business owners to take responsibility for their company finances.
I posted that financial advisors are responsible for the companies they work with to have good financial plans, including a 13-week cash flow model. Now, I am putting the responsibility 100% onto business owners. There are no more excuses.
For too long business owners have said...
"It's not about the money, it's about the people."
"I do it for the love of my craft."
"Someone else can deal with the finances."
"I want to be my own boss, but so I decide that I only want basic bookkeeping."
Now a tiny virus has told you that you are wrong.
You are in business. Business is about the numbers.
Not only numbers, but if you don't have money, you can't...
...work your craft
...let someone else worry
...be your own boss
If you survive this downturn, fix your finances.
Start with a cash flow model that tells you how long you can survive. (Put "Cashflow" in the comments if you...
Cash flow management isn’t about money. It’s about getting your life back.
I’ve worked with business owners who were sick with concern, fear, and doubt about how they will make payroll, meet bank covenants, and literally keep the lights on. They've told me with tears in their eyes that they don't know if they can survive past another payroll. Their spouses express concern about the health and well-being of their partner.
By focusing on cash flow - when and where cash was coming and going from the business - they were able to turn around the business completely, or stay afloat long enough to sell the business.
And yes, some businesses fail, but it’s because of a fundamentally unsound and unsustainable business model.
If you or someone you know have good sales and margins, but are struggling to have the cash to pay the bills, get help.
Open up to someone who can integrate and monitor a cash flow model with your company’s financials and help you make decisions...
Want to solve 80% of your bookkeeping needs to solve cash flow management issues?
Then do two simple things:
1. Reconcile your books every week without fail. Do it on Friday, last thing so you are ready to update your cash flow projections on Monday.
2. Create bookkeeping reports that give you insights into the key cash flow indicators that you need. One example: Accounts receivable aging.
Is there something else that you think needs to be done?
Let me know in the comments.
#tcmp #bookkeeping #reporting
The first time I went skiing as a teenager I watched my classmate beautifully ski down the hill and, in slow motion, turn gently to the left and ski into a barn.
The barn wasn't anywhere near the bottom of the run. It was way far away and posed no danger to anyone. But as the instructor shouted "Stay away from the barn!" her turn became sharper until she was pointed directly at the big, red barn!
I suspect that her problem was that she focused on "not hitting the barn" instead of going straight.
That's a lot like when in business we are focused on preventing a result instead of focusing on the result we do want. We often end up "hitting the barn" instead of getting the result.
When I ski and I'm moving fast, I always need to focus on where I need to go and I consciously block thinking about obstacles that could cause danger. I know the danger is there, but I focus on where I want to go.
The same in business. Focus on where you want to go.
I'd love to hear any comments you've had, or...
Do you know that crowdfunding can be an effective cash management tool for raising capital?
Crowdfunding is pre-selling products that are in development. You owe people something, but usually at a good profit margin. You don't sell equity in your company and you don't go into debt. You do get:
- Publicity before you launch
- Feedback on your product
- Ideas for additional product
- An idea for market acceptance
- Names for your mailing list
- The cash you need to launch the product or business
Most people think of Kickstarter or Indiegogo (I've used Indiegogo) as only for new companies...wrong! You can introduce new products as well.
I've done crowdfunding for non-profit as well as for-profit organizations. Possibilities for funding:
- Book launches
- Food vendors
- Service providers
- Race/adventure organizers
- Non-profit fundraising
The possibilities are literally endless.
Have you done any crowdfunding? I'm looking for any reason not to do it.
Have you bought something from...
If you are interested in learning more about cash flow management, then you should follow Barb Easter, Blaine Bertsch, and Jeremy (JD) Burke from Dryrun - Cash Flow Management Software. These hyperlinks will take you to their LinkedIn pages.
Why would I recommend you follow someone else and not spend all of your cash flow time on my posts and articles?
A few reasons:
1. They have a great point of view
2. They work with end-users and finance professionals from all over the world
3. DryRun is the best cash flow management software I have seen so far for businesses over about $1 Million in revenue
4. They are educating the marketplace
I'd love feedback on what you think about DryRun software.
Do you use cash flow management software? Or spreadsheets?
If so, I'd love to hear your opinion on your software or why you use spreadsheets.
What do you like? What doesn't work? What else do you need?
Let me know in the comments below!
#tcmp #finance #bestadvice
*I am not...
Strategic Action Plans
You know where you are today. You know where you want your business to go. So why is it so hard to change?
Because making real changes in a business takes big, bold shifts in actions, attitudes, and thinking.
You know all of that, so why is it STILL so hard to make changes?!
Because most business owners and managers are so busy working on the day-to-day challenges of running an ongoing business that it is next to impossible to focus on the work needed to create change.
Strategic action plans identify the changes that need to be made in a business and then break them down into achievable tasks that can be accomplished in 1-2 weeks. Most of the time an individual task doesn’t make a major change in a business. But ask yourself, ”What would happen to my business if every week I can implement just two small changes that would move my business in the direction of my ultimate goal?”
Two changes a week would mean 26 changes for your business in the...
A quick internet search on the term “list of ways to grow sales” brings up list after list of “proven ways” to grow sales. Most suggestions are sales and instant demand generation activities.
Why is there so much focus on sales and instant demand generation? Three fundamental reasons: