Running a small or medium-sized
enterprise (SME) can be compared to piloting an aircraft. In the
achievement of your objectives, you keep your eye on certain
controls. As velocity and altitude are typically the two most
important gauges for a pilot, for the owner of an SME, it is usually
profitability and cash flow. Too often, SME owners will neglect cash
flow. This may result in the business equivalent of crashing an
aircraft into a mountainside.
So why is cash flow so
important?
First, cash is like the gasoline in an aircraft or
automobile. You run out, you crash. New companies, particularly in
the hi-tech business, talk of a “burn rate”: the higher your
overheads, the faster your gasoline is being depleted, the faster you
must either reach cash break-even or get a cash infusion, failing
which, you crash.
Second, many businesses are seasonal. Even
though they may be highly profitable, they may require huge amounts
of cash at certain times of year (like when inventories and
receivables are building up), and throw off huge amounts of cash at
other times of the year, (like when inventory and receivables might
be declining). The cash flow in seasonally positive months may easily
give a false sense of security. Like a predator in the jungle that
must ensure it has enough energy to make it to the next “kill,”
the SME owner must ensure that there is enough cash even in the good
months to make it through the entire cycle.
Third, cash is
also a buffer that protects a business in any down cycle. If the
bottom falls out of the economy – and your company’s sales –
your cash buffer will determine how long you can survive and whether
you will survive until your sales pick up again. Deceptively, many
businesses with cyclically declining sales are cash-flow positive; as
receivables diminish, they are turned into cash. Such businesses
survive downturns very well, only to hit a wall when they are
recovering, where receivables once again begin to accumulate.
Fourth, cash flow may be strained whenever there is a capital
investment program. Will your business have enough gasoline to take
it not only through the capital investment program, but also the
increase in sales required to pay off any bank loans, etc.,
associated with the investment? One of my clients entered into a €10
million investment and expansion program, only to find out that the
expected revenues from the expansion did not materialize due to the
recent recession. It helps to do the analysis beforehand.
Finally,
banks usually monitor cash flow, and will often prescribe cash flow
coverage ratios (such as cash flow during any given period must be a
minimum of X times interest, or Y times principal and interest).
One of the most important exercises that the CFO or financial
manager should do is a Profit & Loss / Cash Flow Statement. This
is vastly superior to the “back of the envelope” liquidity
calculations that most SME’s employ. Generally, an excel
spreadsheet will suffice, and it is generally not difficult to create
a spreadsheet that will give you both P&L and cash flow
statements. Make the statement as “granular” as you require the
information—weekly, monthly, or quarterly, and for as far out as
you need it: a minimum of one year, but could be for multiple years.
This type of forecast should not be performed annually and
then forgotten until the following year. Rather, it should be a
“living” document, updated periodically to reflect up-to-date
information. It may also be used for sensitivity analysis: “what
if” decisions. What if the company were to engage in a new
investment? What if the company were to open a new office? What if
the company were to take on a new product line? Or open a new
warehouse? All of these “what if” decisions may be quantified.
And not only will the owners and management of the business be able
to ascertain whether or not such decisions will crash the business
from a cash flow perspective, if one uses the cash flow forecast to
calculate Net Present Value, one may also ascertain whether the
decision is accretive to the value of the business, or diminishes its
value.
Performing this type of analysis regularly is an
important step forward in the corporate governance of a company. The
vast majority of investors will require this type of information. You
might say that it is the business equivalent of moving from Visual
Flight Rules to Instrument Flight Rules, which allows pilots to fly
also through fog or through the night. It may be an important step in
leaving behind “crisis management,” to building a real company.
Wednesday, May 22nd, 2013
About the author
Corporate Finance/M&A Corner
BY Les Nemethy
CEO Euro-Phoenix Financial Advisors READ MORE
My links
Archives
Technorati Profile
Re: Looking for foreign investors & business partners for our real estate business in Bangladesh.
Hello.
Good Day.
This is Faisal from Bangladesh.
We have a real estate company (3G BUILDING TECHNOLOGY LTD) & we are the registered company of Bangladesh Government. Now we have some projects for build up new building. we have also land in Coxbazer project. As you know, Coxbazer is the largest sea beach in the world. If we build up a resort or any kind of 3 star hotels & sell that project than it will be so profitable business. Dhaka is the capital city & Chittagong is the port city of Bangladesh.
Dear Sir as per Bangladesh government announcement, Bangladesh real estate sector is number one rising sector in Bangladesh. Real estate Market of Bangladesh is almost saturated by the thousands of real estate Company which is around Dhaka, Chittagong, Sylhet and some district of Bangladesh but we have not enough money for construction work. We will make per square feet US 38$ & we can sell per square feet US 64$ average (in Dhaka). We are looking for a business partner to increase our business level & we decided that, we will sell some share of our company to investor as a chairman or director.
Dear sir many countries investor are invested in our country. Such as
1. China - company name: China Garden City Developers Ltd.
2. America - company name: America Purbanchol city.
3. Japan - company name: Japan Bangladesh Friendship society
& etc.
I would like you to join me; it is a highly profitable business. Kindly contact me & I can tell you each & everything in detail & we can further go on.
Waiting for your answer.
With best regards
Shekh Md. Faisal.
Director.
3G BUILDING TECHNOLOGY LTD.
Address:
House No- 1010/A
Road No- 16
Khilgaon.
Dhaka-1219.
Bangladesh.
Phone:
+880 1917 162751,
+880 1841 162751.
E-mail:
info.3gbtl@gmail.com,
mdshekhfaisal@gmail.com
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Once you see the Christian Louboutin Sale , you can know this is Louboutin, need not seek logo. The famous designer Christian Louboutin once said: "exactly is high-heeled shoes makes a woman has health, because high-heeled shoes lets they slowed steps. The difference, like driving is different from cycling. At least cycling can enjoy the scenery on the way..." Can say, the woman wearing the Christian Louboutin UK Sale is not so as not to miss a popular landscape street? But, when women in appreciate the scenery, imperceptible in also becomes the scenery. Any questions,please feel free to contact us.
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Tips to save wedding dresses
Wedding dress brought home after the wedding, it is necessary to carefully hide it in the bottom, to save life. No matter it is expensive or cheap wedding dresses.All of them with your sweet memories.However, if you are easily put it entrusted to the streets of small laundries, may regret it for life ---- wedding maintenance and other precious clothing is very different. Once you master a few tips, and your own cleaning, preservation wedding is not difficult.
I bought my wedding dress online and the dress was delivered EXACTLY as pictured. The materials are very high quality and the beading is an intricate lace pattern done with beads that is beautiful in person. I would like to recommend anyone looking for a designer dress to order wedding dress in the site. You can click the picture to order wedding dress in the site.
Very very beautiful wedding dress, just like in the picture.
Wedding wash, wet cleaning is the key, because the small wedding decorations, such as beaded trim, can not stand the erosion of dry cleaning chemicals, the best method is to mix wedding into a moderate, neutral detergent in water soak for a while, it can washed the dinner wine, Hun and other stains left behind, more bubbles for a while, even the invisible stains such as perspiration, white wine stains can be removed.
Wedding wash, dry thoroughly, you can collect up to be stored in a cool, dry place, such as a closet or under the bed, remember, do not hang up the wedding, because the elderly are run, so weighty point the wedding will produce vertical force, stretching or even tearing the skirt body. The wedding greatly panniers can be reversed up collection, but every year Fanshai clothing, to hoop skirts restitution, lest it loses its elasticity.
There are two minor issues to be mentioned: First, before collection of wedding you want to wash your hands, do not glue cosmetics, or over time, there will be a small yellow spot on the wedding.
2013-04-03, 4:01:41 | sareastalia | 180
Tips to save wedding dresses
Wedding dress brought home after the wedding, it is necessary to carefully hide it in the bottom, to save life. No matter it is expensive or cheap wedding dresses.All of them with your sweet memories.However, if you are easily put it entrusted to the streets of small laundries, may regret it for life ---- wedding maintenance and other precious clothing is very different. Once you master a few tips, and your own cleaning, preservation wedding is not difficult.
I bought my wedding dress online and the dress was delivered EXACTLY as pictured. The materials are very high quality and the beading is an intricate lace pattern done with beads that is beautiful in person. I would like to recommend anyone looking for a designer dress to order wedding dress in the site. You can click the picture to order wedding dress in the site.
Very very beautiful wedding dress, just like in the picture.
Wedding wash, wet cleaning is the key, because the small wedding decorations, such as beaded trim, can not stand the erosion of dry cleaning chemicals, the best method is to mix wedding into a moderate, neutral detergent in water soak for a while, it can washed the dinner wine, Hun and other stains left behind, more bubbles for a while, even the invisible stains such as perspiration, white wine stains can be removed.
Wedding wash, dry thoroughly, you can collect up to be stored in a cool, dry place, such as a closet or under the bed, remember, do not hang up the wedding, because the elderly are run, so weighty point the wedding will produce vertical force, stretching or even tearing the skirt body. The wedding greatly panniers can be reversed up collection, but every year Fanshai clothing, to hoop skirts restitution, lest it loses its elasticity.
There are two minor issues to be mentioned: First, before collection of wedding you want to wash your hands, do not glue cosmetics, or over time, there will be a small yellow spot on the wedding.
2013-04-03, 4:01:42 | sareastalia | 180
Tips to save wedding dresses
Wedding dress brought home after the wedding, it is necessary to carefully hide it in the bottom, to save life. No matter it is expensive or cheap wedding dresses.All of them with your sweet memories.However, if you are easily put it entrusted to the streets of small laundries, may regret it for life ---- wedding maintenance and other precious clothing is very different. Once you master a few tips, and your own cleaning, preservation wedding is not difficult.
I bought my wedding dress online and the dress was delivered EXACTLY as pictured. The materials are very high quality and the beading is an intricate lace pattern done with beads that is beautiful in person. I would like to recommend anyone looking for a designer dress to order wedding dress in the site. You can click the picture to order wedding dress in the site.
Very very beautiful wedding dress, just like in the picture.
Wedding wash, wet cleaning is the key, because the small wedding decorations, such as beaded trim, can not stand the erosion of dry cleaning chemicals, the best method is to mix wedding into a moderate, neutral detergent in water soak for a while, it can washed the dinner wine, Hun and other stains left behind, more bubbles for a while, even the invisible stains such as perspiration, white wine stains can be removed.
Wedding wash, dry thoroughly, you can collect up to be stored in a cool, dry place, such as a closet or under the bed, remember, do not hang up the wedding, because the elderly are run, so weighty point the wedding will produce vertical force, stretching or even tearing the skirt body. The wedding greatly panniers can be reversed up collection, but every year Fanshai clothing, to hoop skirts restitution, lest it loses its elasticity.
There are two minor issues to be mentioned: First, before collection of wedding you want to wash your hands, do not glue cosmetics, or over time, there will be a small yellow spot on the wedding.
2013-04-06, 20:43:01 | rymcvickermarjo | 180
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Why Choose Us as Your Wholesale Suppliers
Why Choose Us as Your Wholesale Suppliers
We are a well-established worldwide wholesaler. Here, we provide a wide range of products at very low prices. If you need products for personal use in bulks, or you have a retail outlet and wish to look for a reliable and long-term supplier with premium quality products, we would be the best partner for you. We will also constantly send promotions and offers to our wholesale customers. We are committed to provide you with the best service.
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Replica The piaget-MISSPROTOCOLE series G0A23013 Ms. Quartz watch
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Replica The piaget-MISSPROTOCOLE series G0A23013 Ms. Quartz watch
$8,628.00 $192.00Save: 98% off
Add to Cart:
SeriesMISSPROTOCOLE Series
Style
Female form
Movement
Quartz
Movement Model
-
Case
18K gold
Size
16mm
Thickness
-
Crown
Ordinary
Bottom of the table
Ordinary
Table mirror
Copy Sapphire crystal glass
Dial
White
Watchband
18K White Gold
Strap Color
Golden
Clasp
-
Waterproof
30 m
Package
Beautifully packaged box
Function
Time display
Launch of Year
-
【Brand story]The Earl Table a rising star for the watches. It among the ranks of first-class watches, or the matter of the late 1940s. Today, many prominent families trend of if the birds' top table, in its take-off before, but after nearly a hundred years of slow development.In 1874, Georges Edouard Piaget movement production started. In 1940 Piaget grandson expanding the international market for the development of the Earl of table. In 1956, Piaget introduced the ultra-thin movement. Since the 1960s, the Earl of side dedicated to the study of complex movement side development top jewelry design. From design, production of wax models to inlaid stones, Piaget always adhering to the purpose of excellence. "Handcuffs watch" (cuff watches) and coin watch "(coin watches) design superior, the Earl of watches treasures. Is currently under Swiss Richemont.Since its inception in 1874, the count has always been committed to enhancing creativity, modification details and integration of watches and jewelry crafts, reflecting the premium brand of style. Earl was originally specialized in the research and manufacture of watch movements, and later further promote the exquisite art jewelry techniques, was able to launch in the 1960s, the first jewelry watch. The count has been self-transcendence, outstanding ability, which specializes in the research and development of rare, precious and unique works.The Earl entered in more than 50 years ago, the temple of fine jewelry. Since this Earl is not just a last name, but the depth and rich expertise synonymous. Watches and jewelry are heady took craftsmen hundreds of hours meticulously creating works of art, and probably the only way they will not disappoint PIAGET's reputation. Whenever we look back at the Earl 130 years of history, there is a kind of cohesion blowing warmly jewelry and time, and the kind of atmosphere, impressive.
Model: 11042
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Replica The piaget-MISSPROTOCOLE series G0A23013 Ms. Quartz watch
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Replica The piaget-MISSPROTOCOLE series G0A23013 Ms. Quartz watch
$8,628.00 $192.00Save: 98% off
Add to Cart:
SeriesMISSPROTOCOLE Series
Style
Female form
Movement
Quartz
Movement Model
-
Case
18K gold
Size
16mm
Thickness
-
Crown
Ordinary
Bottom of the table
Ordinary
Table mirror
Copy Sapphire crystal glass
Dial
White
Watchband
18K White Gold
Strap Color
Golden
Clasp
-
Waterproof
30 m
Package
Beautifully packaged box
Function
Time display
Launch of Year
-
【Brand story]The Earl Table a rising star for the watches. It among the ranks of first-class watches, or the matter of the late 1940s. Today, many prominent families trend of if the birds' top table, in its take-off before, but after nearly a hundred years of slow development.In 1874, Georges Edouard Piaget movement production started. In 1940 Piaget grandson expanding the international market for the development of the Earl of table. In 1956, Piaget introduced the ultra-thin movement. Since the 1960s, the Earl of side dedicated to the study of complex movement side development top jewelry design. From design, production of wax models to inlaid stones, Piaget always adhering to the purpose of excellence. "Handcuffs watch" (cuff watches) and coin watch "(coin watches) design superior, the Earl of watches treasures. Is currently under Swiss Richemont.Since its inception in 1874, the count has always been committed to enhancing creativity, modification details and integration of watches and jewelry crafts, reflecting the premium brand of style. Earl was originally specialized in the research and manufacture of watch movements, and later further promote the exquisite art jewelry techniques, was able to launch in the 1960s, the first jewelry watch. The count has been self-transcendence, outstanding ability, which specializes in the research and development of rare, precious and unique works.The Earl entered in more than 50 years ago, the temple of fine jewelry. Since this Earl is not just a last name, but the depth and rich expertise synonymous. Watches and jewelry are heady took craftsmen hundreds of hours meticulously creating works of art, and probably the only way they will not disappoint PIAGET's reputation. Whenever we look back at the Earl 130 years of history, there is a kind of cohesion blowing warmly jewelry and time, and the kind of atmosphere, impressive.
Model: 11042
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2013-04-20, 1:46:03 | sareastalia | 180
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Christian Louboutin Sandals ::
Christian Louboutin Patent Ankle-Wrap Espadrille Cherise
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$1,044.20 $134.90Save: 87% off
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shoes blog shoes About ilouboutinpumps.com blog
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