• Thrive, don't just survive, in difficult times

    When a business faces difficult times such as today's economic environment, management is almost always operating with limited resources and one of those is limited financial management expertise. The Controller of a business is often capable of preparing the essential compliance reports, but may not have the experience to effectively manage the financial needs of a business during difficult [...]

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    Speeding up the collection of receivables

    The cash of a business is tied up, amongst other places, in its receivables and this is the easiest place for most businesses to reduce their cash requirements. If you can reduce the average time for collection of your receivables, this will have a direct impact on the amount that you are borrowing or on cash available for other purposes. In most businesses, accounts receivable are a necessary [...]

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    Identifying & Leveraging your Key Performance Indicators

    In an article on About.com, F. John Reh defines Key Performance Indicators (KPI) as "financial and non-financial metrics used to help an organization define and measure progress toward organizational goals. KPIs can ... assess the present state of the business and assist in prescribing a course of action." Informationbuilders.com describes KPIs as "high-level snapshots of a business or [...]

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    Breaking even and capacity utilization - considerations to improve your bottom line

    Last month, in an article Breaking even - a big deal! I explained why it is important for a business to be aware of the volume at which it breaks even. How to utilize contribution accounting facilitates making decisions that can result in significantly more profit for the business. Every dollar of sales, at a price in excess of your variable costs (cost of goods sold and any overheads that vary in[...]

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    Breaking even - A big deal!

    Have you ever wondered why no name products and house brands are often able to be sold at prices so far below the comparable national brands? Of course there are lower marketing and handling costs but there is often a larger factor in the pricing of the manufacturer to the retailer that results in the lower selling price to the consumer. Most businesses do not focus on what it takes to break [...]

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    Preparing a Budget

    When you prepare a budget or forecast, ensure that the income statement, balance sheet and cash flow forecast interact, so that last minute changes in any one of them will flow through to the other document. Any person that receives the budget will be much more impressed if the document has all four essential parts to it: Earnings statement forecast Balance Sheet forecast Cash flow forecast [...]

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    Become creative at tax return time

    Over the course of the next two months most businesses will have to file a tax return and most companies delegate this task to their external accountants, which is the way it should be, as it is far too complex to be done by anyone who is not an expert. However, that does not mean that you, as the owner or President of the business, cannot get value for the business out of the process. Remember [...]

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    Insurance and minimizing risk

    Too often insurance is considered a "necessary evil" and an overhead that cannot be managed. Periodically it is important to think of the real needs and the benefits that restructuring the businesses insurance can bring to the enterprise. A careful review of the risks in the business may highlight insurance needs that are not covered by the current policies. This may include: Casualty [...]

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    Sources of financing

    In these more challenging times, it is important to assess whether your business has the financial resources to weather the impending storm (or at least an economic slow down). Assess whether each of the sources of financing that is currently being used is likely to agree to an increase in your limit and if there is an increase possible make arrangements for it now. Remember that bankers (and many[...]

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    Key performance indicators

    How can you use key performance indicators (KPI) to measure and help run your business? If you regularly report and investigate fluctuations in the KPIs in your business, you will often find problems sooner & find solutions faster than if you do not use this tool. Also, they are a great method of setting and measuring objectives for improvement by enabling the business to focus on areas that [...]

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