Inventory

Old is New

If you have been around a while, you’ve had the opportunity to see a number of products some and go. By go I don’t necessarily mean they no longer exist, but just that their popularity has dramatically decreased.

Some Examples

Do you remember Tickle Me Elmo, Cabbage Patch Dolls, Pet Rocks, Hula Hoops, Yo-Yo’s, and Beanie Babies? While these products still exist, all have seen better days as to their popularity. The point is that each had its day. For example, there was a time Read the rest of this entry »

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Managing a Vendor

Management involves more than just internal company activity. It is important to be deliberate about managing relationships with both customers and vendors.

Terms and Payment

Every vendor, whether of products or services, has terms of doing business. It is in the best interest of a company to comply with these terms as closely as possible. If you know that your payment is going to be late, do not hesitate to tell a vendor. Though they may not like being paid late, they will appreciate the communication, particularly if Read the rest of this entry »

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The Risks of Suppliers

Every company has vulnerabilities. For example, if you only have one customer or client and you lose them, you are out of business unless you can find at least one new customer. The more common scenario is when a company has multiple customers but one or two customers represent such a significant portion of their business that the loss any of them would considerably alter the picture. This change could be forcing a closure, cutbacks in employees, or other forms of financial belt tightening. Probably you are aware of this risk and are hopefully doing something to mitigate it.

There is another risk that many companies overlook–risks of suppliers.

Dependency

You have undoubtedly heard the expression, Read the rest of this entry »

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Cash Flow–The Bottom Line

In the 1986 move Jerry Maguire, there is a famous line, “Show me the money.” Actually, when ever I read or hear about how profitable a business is, that line comes back to me.

Cash or Profits?

While there are any number reasons a company may fail, one of the most common is falling short of cash – that is insufficient positive cash flow. In fact, on paper some companies are very profitable yet they still fail. On the other side of this same coin, some companies remain unprofitable for an extended time and still survive because they possessed adequate cash flow. Of course, let’s be realistic here – a company cannot continue forever being unprofitable. But, profit alone is not enough. Read the rest of this entry »

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Dave Ramsey’s EntreLeadership Reviewed

“Wear the old coat and buy the new book.” – Austin Phelps

If you have ever listened to Dave Ramsey on the radio or read any of his books, you will understand that the quote above fits nicely with his way of thinking.  For example, in his book EntreLeadership one of the points he makes is that a business does not necessarily need to by new equipment (call equipment the old coat), yet he also emphasizes investing in the education and training of employees (the new book).

In early 2011 I read his book, Financial Peace Revisited. It was insightful and in general I would have to say Read the rest of this entry »

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What is Your Business’s Weakest Link?

Recently I read an article about Jeff Bezos and the dominant and apparently ever expanding  role of Amazon on the web.  This got me to thinking about how the present connects to the past for business.

Weak Links Are Everywhere

First let me clarify, I in no way intend for the title of this article to suggest that I view Amazon as the weakest link for another business.  That said, Amazon is the dominant player in many areas.  Here is a company that started out selling books and has Read the rest of this entry »

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The Long Tail to Grow Your Business

Every now and then I read a book that seems to forever change they way I view things.  One such book is The Long Tail, by Chris Anderson.  I probably first picked the book up a little over three years ago, and like a good novel, it kept my attention from beginning to end.  As I look back, it is very much a book about how to create business growth and business improvement through seizing opportunities.

What Is the Long Tail

In a nutshell, the long tail is a focus on micro-markets.  Mind you, the definition of a micro-market is a somewhat of a relative term, but suffice it to say that a micro-market is small in comparison to Read the rest of this entry »

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5 Ways to Save Money in Your Business

Let’s start by saying up front that this is not another “tighten your belt” lecture.  In fact it is not a lecture at all, but really a set of observations.  It is, however, about expense reduction and more efficient asset management.  It involves business improvement, business planning and financial management.

Who’s Doing the Work?

Over the years I’ve had the opportunity and privilege of providing services to a variety or companies as either an employee or a consultant.  During that time it became apparent that Read the rest of this entry »

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Small Inventoy | Big Benefits

In a previous blog, 3 Low Cost Sources of Cash – Part 1, the benefit a smaller inventory balance as a ready source of internal financing was discussed.  While I will not revisit that particular benefit, it is important to keep in mind that maintaining inventory levels that are not excessive offers Read the rest of this entry »

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3 Low Cost Sources of Cash – Part 1

Have you ever experienced the stress, strain, and anxiety of not having sufficient cash, thus finding yourself resorting to juggling creditors and even employees to survive?  If so, this blog is for you.

In these tight economic times, nearly every company is concerned with whether they will have access to adequate capital.  In contrast to the past, lenders are scrutinizing borrowers much more closely, and in many cases simply saying “No” to loan requests.  In an earlier blog called The Big 4 Capital Users, I used the acronym CRIP to represent 4 activities that heavily impact cash.  Specifically they are:

C –  Capital Equipment.  (Fixed Assets and their financing)

R –  Receivables (Accounts Receivable along with Credit and Sales Policies)

I –   Inventory (Controls, purchasing policies and procedures, and levels carried)

P –  People (Human resources, employment practices, training, turnover, etc.)

In this list there are three items I think are most often misunderstood, and as a result, small businesses frequently miss Read the rest of this entry »

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