SIMPLIFIED CASH MANAGEMENT

There was an interesting post on the TAB Hotline about how upset business owners are with their accountants. CPA’s abilities are to look at the past and they do a fantastic job on your taxes. Accountants are NOT trained to be CFOs, and manage cash. This is just a small area where the Alternative Board can help. Seeing how other business owners manages their cash and holding each other accountable in the process is a beautiful thing to watch. We are working together to develop a simplified cash management system. Instead of staring at a Profit and Loss Statement, let’s try and be pro-active and project out the next 6 months. Do not think that Sales will cure all ills. That is probably what has gotten most companies in difficulties. One must take a look at the whole picture on a regular and consistent basis. To save money we arbitrarily cut employees, marketing, and sales efforts. Get out your Excel spreadsheets and try entering the following: Sales, Cost of Goods (include variable costs like sales commissions, overtime, etc.), Gross Profit, Gross Profit Percent, Expenses (Make sure to deduct the variable costs mentioned above), Extraordinary Expense, Net Income, Cash on Hand,Start from your fiscal year, and put in month to month numbers. Now put in all your projections for the rest of the year, and see where you need correction. Now your only problem is finding someone to hold you accountable and help you move forward. So join one of my Boards. If not find some advisors that have no agendas to please you, and ask for their help. Believe me it will be the best 4 hours a month, you will spend looking at your business rather then working in your business.