Over the next Several Weeks we will be posting a new and different one-minute video providing business tips and instructional commentary for small business owners. These tips will range from key metrics to consider to the importance of Business and Cash Flow Forecasting.
In the 80s I owned a chain of retail ski stores. You might have thought that the seasonality of the cashflow would be brutal, but I never needed to use one penny of my line of credit, nor did I have any term debt. My name is Michael Barbarita from Next Step CFO providing outsourced CFO Services with your know your numbers minute. Two reasons why I never needed my line of credit: first of all, I was shut in the off season, never tying up cash with unproductive, summer sporting goods inventory. And second I worked with suppliers so that the products I purchased and sold in January, February and March I didn’t have to pay for until October, helping me finance my summer. The moral of the story is do what you do best and negotiate with suppliers so you get what you need. You don’t get what you don’t ask for. And remember, the most successful business owners know their numbers!
Over the next Several Weeks we will be posting a new and different one-minute video providing business tips and instructional commentary for small business owners. These tips will range from key metrics to consider to the importance of Business and Cash Flow Forecasting.
Many companies develop cash flow problems one or two years after having a record breaking sales year. My name is Michael Barbarita from Next Step CFO providing outsourced CFO Services with your know your numbers minute. When the business owner has a record breaking year, they have a tendency to increase their salary permanently, thinking they will continue to increase sales records. This rarely happens. When the business comes off of those record breaking years, the business cannot afford the owners’ higher salary and cash flow problems ensue. The way to prevent this problem from happening is through the use of bonuses, and bonus yourself for a good year, but then, keep taking your normal salary the next year. And remember, the most successful business owners know their numbers!
Over the next Several Weeks we will be posting a new and different one-minute video providing business tips and instructional commentary for small business owners. These tips will range from key metrics to consider to the importance of Business and Cash Flow Forecasting.
Do you really understand the risks of business ownership? Many times we business owners take on risks that we don’t even know about. My name is Michael Barbarita from Next Step CFO providing outsourced CFO Services with your know your numbers minute. One major example of risk is personal reliability. And then we all have corporations to protect us from personal liability, but if we sign personal guarantees, it doesn’t matter if you have a corporation or not, you are personally liable. Most of us realize we’re personally liable on bank loans and credit cards, but did you also know that you are personally liable for pay roll taxes, sales taxes, wages and other stalk holders? And if those personal liabilities are not risky enough, there are many business owners who are personally liable to their suppliers with a credit application that they filled out at the beginning of the relationship. If you have one of those and you have been paying the supplier on time, ask the supplier for a release immediately. In addition, any time you fill out a credit application, cross out the personal guarantee language before you sign the application. And remember, the most successful business owners know their numbers!
Over the next Several Weeks we will be posting a new and different one-minute video providing business tips and instructional commentary for small business owners. These tips will range from key metrics to consider to the importance of Business and Cash Flow Forecasting.
What would happen if a major supplier of yours goes out of business? Or decides to change your credit terms unfavorably, or discontinues a product run that’s important to you? Or, worse yet, cuts you off, to protect a competitor in your market? I’ve seen all of these things happen and suppliers do these things. My name is Michael Barbarita from Next Step CFO providing outsourced CFO Services with your know your numbers minute. Always be on the look out for a back up supplier, when you go to trade shows, identify possible back up suppliers and start developing relationships with them. You just never know. And remember, the most successful business owners know their numbers!
