Small Business Cash Flow E-Book

Denise O'Berry

• Herausgeber: John Wiley & Sons
• Kategorie: Fachliteratur
• Sprache: Englisch

Seitenzahl: 226

Veröffentlichungsjahr: 2010

Beschreibung

Many small business owners don't understand the importance of maintaining a healthy cash flow. More than anything else, cash flow determines the success or failure of a small business. Small Business Cash Flow covers all the basics of cash flow, from selecting a great accountant, to keeping money flowing in and out of the business, to budgeting and record-keeping.

Leseprobe

Table of Contents

Title Page

Copyright Page

About the Author

Preface

OPEN YOUR MIND

CHAPTER 1 - Understanding Cash Flow—Your Number-One Priority

WHAT’S THE PROBLEM?

IT’S ALL ABOUT ACTION

CHAPTER 2 - Your Business Partner—The Accountant

SEARCHING FOR YOUR ACCOUNTANT

DIGGING DEEPER TO FIND THE RIGHT FIT

WORKING WITH YOUR ACCOUNTANT

AN ALTERNATIVE SOLUTION

USING ACCOUNTING TOOLS

CHAPTER 3 - How Money Works in Your Business

KNOW HOW YOUR ACCOUNTING SYSTEM IS SET UP

STANDARD ACCOUNTING REPORTS

ACCOUNTING TERMS YOU NEED TO KNOW

HOW MONEY FLOWS IN A BUSINESS

CHAPTER 4 - Finding and Keeping Cash in Your Business

THE GOVERNMENT DOES NOT FINANCE SMALL BUSINESSES

WHERE TO FIND MONEY FOR YOUR BUSINESS

BEFORE YOU APPLY FOR A LOAN

CHAPTER 5 - Record Keeping Isn’t Drudge Work; It’s Priceless History

WHY BUDGET?

YOUR BUDGET TIME FRAME

GATHERING YOUR BUDGET DATA

CREATING YOUR CASH FLOW BUDGET

MONITORING YOUR BUDGET

USING YOUR BUDGET AS A DECISION-MAKING TOOL

CHAPTER 6 - Charging the Best Price to Keep Your Business Healthy

THE COMPONENTS OF PRICING

PRICING IS ABOUT EMOTION, TOO

PRICING METHODS

ASK YOUR CUSTOMERS

PRICING YOUR HARD PRODUCTS

PRICING YOUR SOFT PRODUCTS

LIFETIME VALUE OF YOUR CUSTOMER

TESTING YOUR PRICES

CHAPTER 7 - Using Your Hidden Cash Resources to Grow Your Business

CHANGE YOUR CASH INFLOW PROCESSES

CHANGE YOUR CASH OUTFLOW PROCESSES

WATCH YOUR COST CENTERS

ADJUST YOUR OPERATIONS PROCESSES

TAP INTO WHAT EMPLOYEES KNOW

CASHING IN ON CUSTOMER LOYALTY

CHAPTER 8 - Marketing—Your Cash Generator

MARKETING IS A FULL-TIME JOB

MARKETING STRATEGIES AND TACTICS

FORMATTING YOUR MARKETING MESSAGES FOR MAXIMUM CASH FLOW

FREE MARKETING OPTIONS

CHAPTER 9 - Resources

FEDERAL TRADE COMMISSION—FACTS FOR CONSUMERS CHOOSING AND USING CREDIT CARDS

PUTTING YOUR HOME ON THE LOAN LINE IS RISKY BUSINESS

MARKETING EXPERIMENTS PRICE TESTING BRIEF - www.marketingexperiments.com

CREATING YOUR STRATEGIC ACTION PLAN

MORE ABOUT SURVEYS

SAMPLE THANK-YOU POSTCARD

SAMPLE LETTER TO REACTIVATE LAPSED CUSTOMER

STRATEGIC ALLIANCE PARTNER—FREE OFFER

THANK-YOU LETTER TO CREATE SALES AND REFERRALS

ENDORSEMENT LETTER (Sent by Your Customer to Their Customers)

BUSINESS IMPROVEMENT ACTION PLAN

Recommended Reading

Web Sites to Visit

Index

Copyright © 2007 by Denise O’Berry. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada.

No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, [phone], fax [phone], or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, [phone], fax [phone], or online at http://www.wiley.com/go/permissions.

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Library of Congress Cataloging-in-Publication Data

O’Berry, Denise, 1955-

Small business cash flow : strategies for making your business a financial success / Denise O’Berry.

p. cm.

ISBN-13: 978-0-470-04097-3 (pbk.)

1. Small business—Finance. 2. Cash flow. I. Title.

HG4027.7.024 2006

658.15’244—dc22

2006011036

About the Author

A small business owner since 1996, Denise O’Berry understands the challenges facing small business. She’s lived them and has helped countless clients work through the same issues. She understands the frustrations, the fears, and the joys of owning a small business. With more than two decades of operational and management experience, O’Berry has developed a sharp eye for how businesses get bloated with inefficiencies, cross-purposes, and miscommunication—and how they can retool for a sleeker, smoother, more strategically focused organization. An entrepreneur who quickly built her own successful consulting business, she helps other small business owners set priorities, take action to grow their business, and create the balance they want between life and work.

Preface

Most small business owners hang out their shingles without having a clue about what’s required to be successful on the money side of their business. They see a bunch of numbers on a sheet of paper and groan about how they wish they’d paid more attention to math in school. But cash flow in a small business is about much more than math. It tells the story of your business and can be adjusted by simple actions you can take to move your business from failure to success.

In the United States we don’t raise business owners, we raise employees. So it’s no wonder many small business owners who have a passion for their business have no idea how to make it financially viable with a healthy cash flow. But somehow you’re making do.

There are millions of you in business. Most of you have fewer than 20 employees. A good portion of you have only one or two employees or manage to go it alone. But you’re facing the same frustrating business issues every single day. You spend most of your day working and have little to show for it. You own a business that is dependent on your presence and you can forget about taking a day off when you’re sick or want to have a little fun. You feel overwhelmed with the financial aspects of your business and don’t understand why you’re always broke even though you’re making a profit.

Don’t despair, help is on the way. In this book, you will learn:

• How to select the right accountant and get the maximum return from that partnership.

• How to get money from the right places to position your business for success.

• The simple strategy for keeping money moving in and out of your business.

• Why having a budget and keeping good records can mean success or failure.

• How to charge just the right price so customers keep coming back (and bring their friends and neighbors, too!)

• How to squeeze the most out of every business relationship, marketing campaign, lost sale, and business process to maximize the cash available.

I’ve met hundreds of you over the years. And I’m proud to be counted as part of the small business movement in this country. But we have to work a bit smarter if we’re going to survive. I hear countless cries time and again from small business owners who are struggling to survive. When I dig a bit deeper, the solution lies in action. We’ve become an instant answer society. We want a quick fix for everything without doing anything. That’s not going to happen in your business. It’s going to take some work to get it on the right track. You have to be willing to commit the time necessary to do that.

Just about anyone can give you tools to fix your problems. This book is your tool. I’m hoping that it becomes a dog-eared copy lying within your reach on a daily basis until you get on the right track. Although I can’t force you to take action, absolutely nothing different will happen until you do.

When I conducted a survey of more than 200 small business owners, they told me what they wanted to learn about how to manage cash flow. The overarching theme of their comments was “help me smooth out the humps in my cash flow.” There is no fast and easy way to do that. It takes consistent action in every aspect of the business to make it work. So I focused on the tasks you need to undertake to help you be successful.

Chapter 1, “Understanding Cash Flow—Your Number-One Priority,” provides a brief overview of the whys behind business cash flow problems. It’s really very simple and describes those things you must understand and what you must look at to begin correcting your cash flow issues.

Chapter 2, “Your Business Partner—The Accountant,” delves into selecting an accountant for your business. I was surprised when about half of the small business owners who took the survey said they had no accountant. An accountant as the financial expert and partner for a business owner is worth their weight in gold. They can help you take the right actions to grow your business and prevent you from making missteps along the way. But it’s important to take the time to choose correctly. Wasting time with the wrong accountant doesn’t help you a bit. I give you a road map for making just the right choice.

Once you’ve got the right partner on your team, you need to know a little about what they’ll be sharing with you and how to use financial reports to understand what happens to the money in your business. In Chapter 3, “How Money Works in Your Business,” you learn about the most important financial statements and key accounting terms that are critical for your business.

It’s easy to overlook places where cash could be hiding in your business. In Chapter 4, “Finding and Keeping Cash in Your Business,” I reveal all the nooks and crannies you can explore to see if you’re missing something. When you’ve found all the cash you can inside your business and are still on the short end of the cash flow stick, looking outside is your best option. You’ll learn about different types of financing available too.

Having a cash flow budget will be a critical key to your success as you move forward. It will help you decide what projects to take on, when you need to slow down cash outflows, and how to make adjustments to the way you do business. Chapter 5, “Record Keeping Isn’t Drudge Work; It’s Priceless History,” may just become your favorite part of this book. Once you’ve learned how budgeting can be such a useful business resource, you’ll wonder how you ever lived without one.

Have you struggled with pricing your products or services? Most small business owners do. Plenty of them severely undercharge, too. In Chapter 6, “Charging the Best Price to Keep Your Business Healthy,” you learn what goes into setting a price for what you offer in your business and how to make your customers love paying you. It also helps you take a longer look at your customers and what opportunities you have for their lifetime of doing business with you.

Chapter 7, “Using Your Hidden Cash Resources to Grow Your Business,” gets into the meat of your business. Sometimes you have to radically change what you do and how you do it to make things work. Process and procedure adjustments can make a big impact. So can having a strategy to make your customers loyal to your business no matter what prices you charge.

Marketing is the lifeblood of your small business. It’s what makes the cash pour in. But it’s not a one-time activity. Using different strategies and tactics to cast the widest net will pay the biggest return for you. In Chapter 8, “Marketing—Your Cash Generator,” you learn about the various strategies for making the most of your marketing dollars.

OPEN YOUR MIND

One major thing I ask of you as you read this book is to open your mind. As you progress, you’ll be reading about a fitness trainer or a restaurant owner or some other type of business owner and may think, Well, that doesn’t apply to me. Although specific examples are used throughout the book, each of them could apply across any industry in any business. Think bigger.

CHAPTER 1

Understanding Cash Flow—Your Number-One Priority

A small business owner is working 80 hours a week and he just discovered he doesn’t have enough money in the bank to pay this month’s bills. That’s a story repeated time and again in small businesses around the United States every single day.