Quick & Easy Finance for Non Finance Entrepreneurs
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Transcript of Quick & Easy Finance for Non Finance Entrepreneurs
QUICK n EASY BUSINESS FINANCE for ENTREPRENEURS
Coach Cynthia Wihardja• Accelerating success with proven systems
• 20-year experience in business turnarounds, marketing and entrepreneurship
• Business Coach & Firm Owner of ActionCOACH South Jakarta
• Master NLP Practitioner
• Author of “It’s My Career. I Decide.”
• Coach’s Coach & Speaker in 13 Countries in Europe, Asia, Americas
• First & only woman in Global Hall of Fame
Who is ActionCOACH?• Proven strategies for increasing business results, building
systems, and improving team performance
• Accelerating Your Success through Proven Systems to Reduce Costly Trial & Error
• Help you create a more sustainable business & achieve your personal dreams
• The only Business Coaching Firm in the World that GUARANTEES RESULTS in 17 WEEKS
• Founded in 1993 by Brad Sugars with a vision of World Abundance through Business Re-Education
• 750 coaches in 60 countries
• Top awards for franchisee satisfaction, contribution to business community and top brand for business coaching
Indonesia Firm of the Year 2014 Global Hall of Fame 2014
IntegrityCOACH 2014 Coach of the Year 2013
Executive Coach of the Year 2012
TeamCOACH of the Year 2012 NetworkCOACH of the Year 2012
Indonesia Improvement Award 2012 AbundanceCOACH 2009 ActionMAN Award 2008
I
BUSINESS FINANCE
Thanks, Keith Cunningham!!
I dunno. But you look pretty
healthy to me…
I dunno. But it looks pretty profitable to me…
If you don’t know the score, you don’t know if you’re winning or losing.
Keith Cunningham
3 MAJOR SCOREBOARDS
BALANCE SHEET PROFIT & LOSS
CASHFLOW
THINGS & STUFF WHAT I OWE
WHAT I OWN
Cash Inventory Receivables
Plant Property Equipment Intellectual Property
Bank Other Lenders Suppliers Tax
Startup Capital Retained Profits This Month’s Profits
BALANCE SHEET
ASSETS LIABILITIES
EQUITY
Cash Inventory Receivables
Plant Property Equipment Intellectual Property
Bank Other Lenders Suppliers Tax
Startup Capital Retained Profits This Month’s Profits
BALANCE SHEET
Is my Balance Sheet HEALTHY?
• Healthy Operating Cashflow
• Healthy Cash vs Debt Ratio
• Healthy Profit Reserves
PROFIT &
LOSS
REVENUE
Variable Cost
Gross Profit
Fixed Costs
EBITDA
Depreciation Amortization Tax
NET PROFIT
100
(40)
60
(30)
30
(3) (2)
(10)
15
1000
(500)
500
(350)
150
(20) (15)
(100)
15
PROFIT &
LOSS
REVENUE
Variable Cost
Gross Profit
Fixed Costs
EBITDA
Depreciation Amortization Tax
NET PROFIT
100
(40)
60
(30)
30
(3) (2)
(10)
15
1000
(500)
500
(350)
150
(20) (15)
(100)
15
USEFUL NUMBERS
1. BREAK EVEN POINT
2. PROFIT BREAK EVEN POINT
3. % of EVERYTHING to REVENUE
4. MAXIMUM UTILIZATION
Is my Profit & Loss HEALTHY?
• You’ve got Profit
• Better Efficiency of Operations
• Things that are supposed to be FIXED stay relatively FIXED
5 Ways to Boost Profits
Leads x
Conversion Rate =
Clients x
No. of Transaction x
Average Sale =
Revenue x
Margin % =
Profit
4000 x
25% =
1000 x 2 x
$100 =
$200,000 x
25% =
$50,000
5 Ways to Boost Profits
Leads x
Conversion Rate =
Clients x
No. of Transaction x
Average Sale =
Revenue x
Margin % =
Profit
4000 x
25% =
1000 x 2 x
$100 =
$200,000 x
25% =
$50,000
4400 x
27.5% =
1210 x
2.2 x
$110 =
$292,820 x
27.5% =
$80,525
61%
MOR
E PRO
FITS
4 M TO INSTANT PROFITMANAGEMENT
MONEY
MERCHANDISE
MARKETING
OPERATING CASH
CASHFLOW
INVESTING CASH
FINANCING CASH
revenue + expenses -
sell assets + buy assets -
borrow + pay loans -
OPERATING CASH
CASHFLOW
INVESTING CASH
FINANCING CASH
revenue + expenses -
sell assets + buy assets -
borrow + pay loans -
Sales is VANITY Profit is SANITY Cash is KING! Keith Cunningham My “Rich Dad”
Pay Attention to Your CASHGAP!!
WHERE IS
CASH HIDING
IN YOUR BUSINESS?
RECEIVABLES
SIMPLE RULES OF CASH
INVENTORY
PAYABLES
EXPENSES
Is my Cashflow HEALTHY?
• The operating cash increases
• You can pay your debt on time
• You don’t need to keep injecting cash into the business for daily operations
• Your cash is not tied up in dead inventory or receivables
The only reason to produce SALES
The only reason to produce SALESis to get PROFITS.
The only reason to produce SALESis to get PROFITS.
But profits ain’t nothin’ unless it turns into CASH.
The only reason to produce SALESis to get PROFITS.
But profits ain’t nothin’ unless it turns into CASH.
Operating CASH !
1999 2000 Q1 2001 Q2 2001
NET PROFIT 827 896 405 788
EPS 1.10 1.12 0.49 0.94
CASH 288 1,374 1,086 847PRICE PER
SHARE $61
THE REAL WORLD
March 12, 2001 $61.27 “Better buy it” (JP Morgan)
March 21, 2001 $55.89 “Strong buy” (Goldman Sachs)
March 29, 2001 $55.31 “Great buy” (Credit Suisse)
June 8, 2001 $51.13 “Recommend it” (Bear Sterns)
June 15, 2001 $47.26 “Better buy it” (JP Morgan)
July 1, 2001 $44.88 “Better accumulate it” (Bank of America)
Aug 30, 2001 $40.25 “Strong buy” (Sanders Norse)
Sep 6, 2001 $30.49 “Long term buy” (Merryl Lynch)
Oct 3, 2001 $33.49 “Great attractive buy” (JP Morgan)
Oct 4, 2001 $33.10 “Better buy it” (Goldman Sachs)
Oct 11, 2001 $31.79 “Great buy” (Bear Sterns)
Oct 22, 2001 $20.65 “You better buy it” (CIDC)
Oct 24, 2001 $16.41 “Long term buy” (Lehman Bros)
Oct 25, 2001 $16.35 “Market Perform” (JP Morgan)
Nov 1, 2001 $11.99 “We’re neutral” (Bank of America)
Nov 12, 2001 $9.24 “Hold on” (Merryl Lynch)
Nov 21, 2001 $5.01 “Hold your position” (Bear Sterns)
Nov 28, 2001 $0.61 “Hold on” (Goldman Sachs)
Nov 29, 2001 $0.36 “Hold on” (Credit Suisse)
Dec 2, 2001 $0.00
Oct 11, 2001 $31.79 “Great buy” (Bear Sterns)
Oct 22, 2001 $20.65 “You better buy it” (CIDC)
Oct 24, 2001 $16.41 “Long term buy” (Lehman Bros)
Oct 25, 2001 $16.35 “Market Perform” (JP Morgan)
Nov 1, 2001 $11.99 “We’re neutral” (Bank of America)
Nov 12, 2001 $9.24 “Hold on” (Merryl Lynch)
Nov 21, 2001 $5.01 “Hold your position” (Bear Sterns)
Nov 28, 2001 $0.61 “Hold on” (Goldman Sachs)
Nov 29, 2001 $0.36 “Hold on” (Credit Suisse)
Dec 2, 2001 $0.00 ENRON files bankruptcy
1999 2000 Q1 2001 Q2 2001NET PROFIT 827 896 405 788
CASH
Operating 1,228 4,779 (464) (1,337)Investing (3,507) 4,264 1,124 (1,161)Financing 2,456 571 1,300 1,971
They told you… but you didn’t understand
1999 2000 Q1 2001 Q2 2001NET PROFIT 827 896 405 788
CASH
Operating 1,228 4,779 (464) (1,337)Investing (3,507) 4,264 1,124 (1,161)Financing 2,456 571 1,300 1,971
They told you… but you didn’t understand
Oregon Newspaper:As 2001 started, Tim Ramsey felt like a million bucks. As a 55 year old electrician, Tim was ready to take early retirement from the money he saved for 30 years amounting to almost $2.5 million. At the end of 2001, Tim’s retirement funds collapsed to nothing more than $10,000. “I was a big sucker,” Tim says, “ for some reason, I listened to those people. I should have my butt kicked.”
— Jim Rohn
“Never wish life were easier. Wish that you were better.”
For a complimentary profit and cashflow diagnosis, contact [email protected]