- Prepare a comprehensive forecast of your profits, cash flow, and capital requirements to anticipate financial needs and plan strategies to accomplish your annual objectives.
- Re-engineer your cost and margin structure to lower your break-even, but be careful not to cut more value than cost.
- Develop good cost records to assure appropriate pricing and manage results.
- Make sure you have current and accurate financial statements to respond quickly to changing conditions.
- Make sure you have the management reports needed to help make sound and timely business decisions.
- Use sound cash-flow management along with your profit management.
- Offer cash discounts to accelerate cash flow and provide liquidity.
Focusing on these strategies will help you define reality which, in turn, will make a significant improvement in your profits and cash flow — in good times or bad. In bad times, however, they are critical and will make the difference between making money and breaking even or losing money!
The ABA Insider is published by American Business Advisors, Inc. to provide business and personal improvement information and ideas. All material is presented to provide general and broad information only. The information found in this publication does not constitute business, tax, financial, or legal advice and should not be acted upon without seeking the counsel of professional advisor.