What does the SBDC offer to entrepreneurs

Cecilia V. Rivas Schürmann, International Trade [email protected]

What does Cochise College SBDC offer to entrepreneurs?

1. Cochise College SBDC client’s economic impact

2012 2013 2014 $3,900,000

$3,950,000

$4,000,000

$4,050,000

$4,100,000

$4,150,000

$4,200,000

$4,250,000

Cochise College SBDC Client's Economic Impact 2012-2014

Capital Formation Increased Sales

1. Cochise College SBDC client’s economic impact

Jobs Created Jobs Retained New Businesses0

10

20

30

40

50

60

70

80

90

Cochise College SBDC's Clients Jobs and New Businesses 2012-2014

2012 2013 2014

2. Whom do we serve?

Startup

Scale-up

ScalerSustainableCorporate

Early-stage barriers

Crossing the chasm

From Startups to Scale-ups

3. How do we serve?Our services are tailored to our client’s needs:

· Business plan - research· Cash flow projections· Sole proprietorship? LLC? Inc.? and tax implications

· Employer Identification Number (EIN)· Establish Dun & Bradstreet file for business· How to increase business’ value in case of sale?


Sales increase Sales are a by-product of many elements. A Marketing Strategic Plan

will review the price, the product, the promotion (where sales strategies belong), and the place (distribution): physical vs web,

combination?


Achieving GoalsGoals are great and execution is better.

The 4 Disciplines of Execution by Franklin Covey bridge the gap.


Wealth MaximizationIncreasing sales is important and maximizing wealth is the end goal. Profit Mastery ®is

a great tool to understand the relationship between the income statement and the balance sheet. The combination of these two financial statements

provide a visual cause-and-effect relationship leading to financial distress or success.


Wealth Maximization7 Steps to Business Success

1. Plan properly2. Monitor financial position – ratio

analysis cause-and-effect “Road Map”3. Price-Volume-Costs Relationships –

break-even analysis


Wealth Maximization7 Steps to Business Success

4. Managing cash flow – cash flow analysis5. Managing growth – financial gap analysis6. Borrow properly – the 5 “C’s” of credit7. Planning for transition – estate planning


Wealth MaximizationMeasures

yearly resultsgood year/bad

year

Measures long –term results

good long term/bad long term


Wealth MaximizationRatio Analysis Spreadsheet: 14 ratios

1. Balance Sheet Ratios – signaling “Stability”2. Income Statement Ratios – signaling “Profitability”3. Asset Management Ratios – overall efficiency and

working capital cycle ratios

Company’s ratios are compared with industry average ratios to develop spreadsheet and roadmap


Wealth MaximizationRatio Analysis Spreadsheet:


Wealth MaximizationWorking Capital Cycle

CASH

INVENTORYA/R


Wealth Maximization – The CUP

Variable Costs

FixedCosts

Variable Costs

Net Profits

Sales Dollars

Contribution Margin, % of Sales

Net profits occur if there is anything left after the fixed cost cup is filled


Wealth maximization – Road map


Profit Mastery AssessmentCash NPBT

1. Inventory $60,000

2. A/R $16,000

3. Hidden costs $19,000

4. Interest $ 7,600

5. Labor $38,000

6. Buying $10,000

7. Pricing $22,000

8. Cash discount $10,000

9. Refinance building $126,000

Totals $202,000 $106,600

Additional NPBT if

company would run efficientlyAdditional

cash-on-hand if company would run efficiently

Questions?

Why we do what we do?

Your

Thank you!Cecilia V. Rivas Schürmann, International Trade Specialist

[email protected]


What does the SBDC offer to entrepreneurs

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