Is Your Cash flow flowing?

How Does Your Cash Flow?

If you haven't read "Rich Dad Poor Dad" take a minute right now and add it to your to summer reading list. The focus is on personal finance, but so much is applicable to businesses, too.

Last week I talked about "Working ON your business not IN your business" and it resonated with many. That statement was coined by Michael Gerber in his landmark "E-Myth" book series. Small businesses create the brightest futures by moving from managing their cash flow to creating wealth. Here is a short history of business styles and how they work their money or cash flow.

Money Path of a Job-Preneur. A job-preneur is a business owner that has created a job for herself. Typically when the owner expires or retires, the business does likewise. The most important information this business owner looks for is cash flow - what is coming in and what goes out. Do we have enough to pay all expenses and maybe put some aside for retirement? If this is your business, just being clear on what it is and planning for the future is important.

Money Path of the Business Owner. The business owner that has some employees and a plan for growth will likely be looking carefully at not only the cash flow of the business but also the Income Statement. The typical business owner will be aware of the liabilities associated with growth and asset acquisition. But few businesses in this category have "income producing assets", they are just large expenses. For example, the company car is an asset and maybe it has a loan, but does it really generate any cash flow? If these businesses are to be sold, the price is usually not much beyond a multiple of the business' profits. No Proft? Difficult to sell over the fair market value of the assets. Again, knowing what your exit plan is may mean that the business is what you want it to be. If you want more from your business, read on.

Money Path of an Entrepreneurial Business. Here the owner is striving to not only pay all the bills, pay down the liabilities and build assets but building a business where the owner works ON the business. A business that builds for the future is managing the cash flow, the income statement and most importantly the balance sheet. The key to getting assets to grow and generate income is having repeatable processes. These processes are for everything from answering the phone to providing outstanding service. If it can't be repeated, you don't have a salable process. These processes free the owner to be a leader and not just a worker-bee. The beauty of buying a franchise is that you are purchasing a tried and true way to have an income producing asset! Think about how you can create a business that is easy for someone else to come and replace you. When you know you can walk away and the cash will keep flowing, you have built a business based on wealth creation.

Being clear as to what type of business you are building means you will have a unmistakable understanding of what to expect. Businesses, like children, can only produce what we train them to do!

Copyright 2011 Linda Lucas Fayerweather
http://www.changinglanes.biz/
419-897-0528

Did You Back Up??

"I never met a hard drive that didn't want to crash."  --Linda Fayerweather  

Getting Ready for the Holidays

Sometimes, practical tips are just what is needed in this busy season. I talk about Lean Office, Lean Management and two big "take-aways" of lean are:
• The customer IS why you are in business
• Waste is the ultimate profit stealer


So, two of the biggest times wasters that don't add to the customer experience are Looking for Something and Fixing Something that should have been Done Correctly the First Time.


This leads to two tasks we really need do before the New Year if we are not already and making sure we have a system in place going forward.
1. Back up our computers.
2. Create an Internet Password Journal that doesn't rely on our memories.


These two jobs can save countless hours. I actually create a clone of my hard drive so that when a crash occurs, I will be able to plug in a drive that is ready to go with all my data and programs.


Although most of my passwords are stored in a database, I also keep an old fashioned written record. I use a simple spiral journal that was actually designed for this to make sure I capture everything. I can't tell you how many times I refer to it in a week. Here is a link to one: Internet Journal.


Create a schedule so you are backing up regularly and do try to restore a file occasionally to make sure the backups are working .


Happy Holidays and time spent now will save in the future as I've never met a hard drive that didn't want to crash. . .eventually.


Copyright 2010 Linda Fayerweather MBA EA
http://www.changinglanes.biz/
419-897-0528
linda@changinglanes.biz
Consider working with a coach or a MasterMind Team to make 2011 the year of your dreams!




Put Your Plan in Action!
Who said, "If you want to eat an elephant, do it one bite at a time"? Whoever it was is a genius! I've recently discovered a piece of software that takes your marketing initiatives and delivers them into bite-sized chunks which you can do daily. The product is called Marketing Mentor ToolBox. Although it's designed for small marketing firms like mine, the product is so good that I'm recommending it to you. It works with your Calendar and keeps your marketing projects top-of-mind. What's better yet, the "to dos" should take you 5-15 minutes a day. Here is a smattering of the bite-sized pieces:


Daily:      Social Media Break
                 Prospecting - Research/Calling/Doing
Weekly:  Attend a Networking Event
                 Proposal Follow-Ups
Monthly: Monthly Recap


By actively working your calendar, you should be able to create a banner year for yourself. Let's toast to new year that's filled with unlimited possibilities! Enjoy!!


Copyright 2010 Rebecca Booth
Marketing Goddess
Imagine That!
419.855.3399
Celebrating 10 years of delivering results for our clients.
www.rebeccaboothmarketinggoddess.com
www.marketinginabox.biz