The statement of cash flows is one of the major financial statements, along with your income statement and balance sheet. This statement provides a historical look at where your cash came from and went. Below is a summarized format for the statement of cash flows. It starts with net cash from operations, followed by net […]

Setting goals is both art and science. Whole books can be written about it. Should you set stretch goals or goals that are more attainable? Two extremes Let’s first look at two extreme goals that aren’t useful: Setting goals too high and too low.  Setting goals too high demoralizes staff. The metric loses credibility and […]

Deciding how to measure a metric is tougher than you think. In key performance indicator (KPI) metric meetings I’ve facilitated, how to measure the metric takes much longer than picking which metrics to measure. For example, should the metrics be measured as: A monthly amount or a YTD amount? The total of something or how […]

When you are clear on your critical success factors, you know what your company must do. You know where you are going and how you will get there. Many companies jump past identifying their critical success factors. They then flounder in later steps of strategic planning.  The link between critical success factors and strategic planning […]

Discover the money beliefs that might be hurting your business and relationship with business partners The statistics are scary. 65% of startups fail as a result of conflict between business partners in terms of their money management styles, personality styles, and conflict resolution approaches according to Noel Wasserman in The Founder’s Dilemmas. “65% of startups […]

There are so many things you could look at to monitor your business finances. Where do you start? The reports below will help you improve the performance, cash flow, and profitability of your company. I’ve grouped these business finance reports into three groups: Backward-looking Forward-looking The one critical report you should be monitoring. For each […]

Skip the overkill of most strategic planning to focus on where you are going and how you are going to get there. You only need enough detail to make the right decisions. Did you ever notice that both strategic planning retreats and horror movies are stories about a group of people trapped in a cabin […]

Business and investment gurus tout how you can make big profits with little money of your own. They show how using other peoples’ money can make you rich. It’s true that using other peoples’ money, known by the acronym OPM, can increase your returns. But OPM can also be like the drug opium. Its highs […]

You’ve probably heard of a SWOT analysis, but you may not be completely aware of how useful it can be for your company. SWOT analysis is a simple but powerful method to assess your company and competitive environment. This knowledge leads to superior strategic plans. The simplicity of SWOT analysis can lure some to underestimate […]

The sustainable growth rate formula reveals the two big decisions that determine how fast your company can grow. Business owners pursue growth out of entrepreneurial instinct. Growth can mean opportunity and profits. However, your financial risk increases when you chase too little or too much growth. What are the keys to growth? The answers lie […]

The triple bottom line broadens your view of your company’s impact. Many businesses focus on one thing – profitability (a.k.a. “the bottom line”). Recently, both business owners and customers are realizing that a single bottom line misses a lot of what they value. Some are now looking at a “triple bottom line.” While profit is […]

Knowing the advantages and disadvantages of sole proprietorship helps you decide if it’s right for your company. When you start a business, the type of entity you select to form your business affects compensation, taxation, liability, accountability, and dissolution or bankruptcy. This article will outline sole proprietorship advantages and disadvantages. It comes from the office […]

Two massive business trends will accelerate in 2021. Are you ready for them? Will each trend be your friend – or the end? COVID’s impact on business is often described as a temporary challenge to endure. That’s wrong. The impact on business is permanent. It’s also the start of a massive surge of business innovation. […]

You may have heard that the Chapter 11 process is somewhat streamlined for small businesses, and this is true. A “small business debtor” is a person or entity who: (1) is engaged in business or other commercial activities; and (2) owes no more than $2,725,625 in total claims as of April 1, 2019, excluding obligations […]

The working capital formula and working capital ratio formulas are popular and easy ways to estimate your future cash flows. Lenders use it to judge your financial health. Do you know how much net working capital you have? Is your net working capital ratio at a healthy level? How can you improve your working capital […]

Use these four methods to prioritize goals and tasks to focus on what’s important. You have lots of ideas. It’s time for action. It’s time to pick one thing and get it done. What’s most important? I’ll show you some practical ways you can prioritize goals and tasks. Carefully choosing what to do next is […]

Improve employee satisfaction and increase efficiency by letting your burned-out employees focus on what they do best. I’m sure you’ll agree overwhelmed and burned-out employees are a problem with every company. It’s particularly severe in overworked nonprofit agencies. A nonprofit coaching client told me they had too many tasks and not enough staff. We used […]

Big opportunities are waiting to be found in your excess capacity. Capture additional revenue with few additional costs. New profits lie hidden unless you know where to look. What machines are quietly idle while others are a flurry of productive activity? Has an employee said they are “ready for a new challenge” or “not being […]

A quick price analysis will significantly increase the profitability of your pricing strategies. Every business owner wants to find pricing strategies that maximize their profits. Once you know the prices of your competitors, do you know how to set your price to maximize your profit? Let me show you how to estimate how your price […]

Many Small Business Owners Don’t Appreciate the Differences Between Cash Flow and Profit. Those Who Understand the Difference of Profit vs Cash Flow Get Both.

The first questions small business owners must ask before selecting the best retirement plan for their business. Retirement plans provide many benefits to small business owners and employees. You may have heard of popular plans like 401(k)s but there are many more choices for small business owners. How do you choose between them? Picking the […]

Don’t Use Historical Profitability Analysis for Forward-Looking Decisions You’ve heard for years that you needed to perform product profitability analysis to know which of your products made or lost money. Maybe you finally calculated the profitability of each of your products. Congrats! That’s a good start. Just don’t use them to decide what you should […]

We like to think our business decision-making process is completely rational. Unfortunately, that’s a delusion. We are prone to thinking errors that are very irrational. How many times have you done the following? Didn’t give up on a losing product or project because you had already invested so much into it you thought you couldn’t […]

Before assuming business growth is the answer, a little research can save you from working hard for no additional profitability. A beaver trap uses the beaver’s instincts to kill it. When a beaver senses danger, its instinct is to go to deeper water. The trap scares the beaver when it latches on. Deeper water is […]