Monday, December 15, 2008

Your 2008-Year End Financial Statement’s, Statistical Review Checklist

Make sure that the following items below are contained in your statistical reports, including variances and percentage changes within those numbers, on the four major income statement components: top line (gross revenue); labor; controllable and non-controllable expenses, and bottom line (N.O.I. with Cash Flow), (all numbers are accumulated and may be partial quarters or years, but each are equal to one another in their respective time frames):

• Month to Date (MTD)
• Quarter to Date (QTD)
• Year to Date (YTD)
• Current Month (MTD) Year over last Year Month (Example: Oct. 08 to Oct. 07)
• Current Quarter (QTD) Year over last Year Quarter (Example: Q4 of 08 to Q4 of 07)
• Year (YTD) over last Year (Example: YTD-2008 to YTD-2007)
• Month over Month (Example: Oct. 08 to Sep. 08)
• Quarter over Quarter (Example: Q4 of 08 to Q3 of 08)
• MTD, QTD, and YTD to budget and stretch goals with remaining/declining balances to reach each of those goals
• Projected QTD and YTD numbers against budget and stretch goals
• Trailing three month average
• Trailing twelve month average
• Trailing eighteen month average
• Trailing three to five year average
• Annualized MTD and QTD numbers

Don’t forget, visually, graphs, charts, and color-coding all add to the accelerated ability to understand, pinpoint, and emphasize negative and positive trending within your statistical numbers. Another great tool is to set parameters around each line item, so an exception report can be generated and quickly identified when numbers exceed those boundaries.

Thursday, December 11, 2008

5 Key Components of a Profitable Holiday Season

In this current economic crunch, many small businesses are feeling the weight of the hard times heavily upon their shoulders. When times start to go bad, however, there are some basic things we as small business owners can do to ensure that we have the best possible holiday season. Take a look at these five key components, adjust your business as necessary, and get ready for a great holiday season.

Check Out the Competition

This is a key component and should always be done if you are in a competitive market. Shop online and in person in businesses like yours and see what the other guys are doing. What can you do to compete with these people? Can you adjust prices and rates or offer any sort of holiday promotions. Think about what you can do to maximize profits and maintain a competitive edge.

Maintain Quality

If you decide to go down the road of lowering prices or rates, make sure that you will still be able to give the same quality and value to your clientele that they have come to expect. It’s one thing to get them in the doors; it’s another thing completely to keep them coming back.

Give Superior Service

Especially during tough economic times, people are less willing to part with their hard-earned money if you haven’t earned their trust. Superior service shows that you are committed to doing the best possible job for you’re your clientele as well as yourself. Superior service and competitive prices will certainly help you to develop a larger client base during this time of increased exposure.

Follow Through

Once you have earned the trust and come through for your customers, make sure that they are satisfied with their products or services. This can be accomplished quickly and effectively through email or a quick phone call. Email is usually preferable, as it’s the least intrusive way of communicating with people. Following through with your clients is a great way to show that you care and will leave a great impression that will have them coming back to you again sooner than you think.

Thank Your Customers

This is a very basic component of business that many people seem to forget these days. Your clients and customers could have gone to a competitor, but they didn’t; they chose your business, so you must show your appreciation. This can be as simple as saying thanks after you have finished the transaction, but could also be done with a credit on a subsequent purchase or a discount for continued patronage. Use your discretion, but remember – people like to feel appreciated, so don’t forget your manners.

This post was contributed by Kelly Kilpatrick, who writes on the subject of currency trade. She invites your feedback at kellykilpatrick24 at gmail dot com

Monday, December 8, 2008

Stop The “What If’s, Of Why Your Business Numbers Are Down!

Instead, start taking responsibility for your own actions in all situations, even the ones that you cannot totally control.

If it happened to you, your actions, no matter how small a part that they played in the outcome, are still a part of the outcome; so take that portion of the responsibility without hesitation. Did you not market your business, thinking, if you built it, they would come? Did you not focus on client retention, when business was booming? Did you not sell value, instead of price when asking for the sale?

There are many factors as to why things happen the way they do. Some of your own actions account for it; some do not. No matter the “what ifs,” remember that sitting around and wondering about them will only displace your time and stop you from changing your situation. Stand out of the crowd, accept your situation, and stop questioning, “Why me?” and, “What if?” after you commit to an action of change to resolve the situation. Only then can you execute a plan to change within.

No matter what, you and you alone have the ability to change your situation. It may not be immediate, but change will happen with an executed plan from a person who has first accepted the reality that it is only their actions that can improve this situation. Taking responsibility for actions in your life is a big step to turn your situation into success.

The difference between success and non-success is in an individual’s ability to believe in themselves as their own element of change and the daily commitment of that individual with that knowledge of success to execute those changes.
So, are you going to take action today? Good, now finish reading and implement.

Monday, December 1, 2008

Was Your Friday Black This Year?

You would know if your company closed its’ books nightly!

Nightly closing of your accounting books allow for immediate reconciliation, so that you can identify and correct posting errors/miscoded items, generate net revenue/ledger balances, and create daily statistical performance metrics for a more accurate analysis.

Would you like to be able to go into your business unit and have some current gauge of the income statement’s profit position at a time frame when changes could be made to affect the final outcome, or would you rather wait for over two weeks after the month ends to find out that there was a negative bottom-line growth; after you were not able to do anything about it?

Although nightly closing of your business unit’s accounting books may not be as feasible for you as some other industries, the mind-set of it is not. Does your business unit have timely, up to date, and accurate accounting books for management to make critical business decisions when they need the information the most? If not, you need to.

Soft accounting closes are not that challenging. Just make sure that outputted numbers are taken into consideration and everyone is aware that there is some “flex” in the numbers. In my judgment, something of a current financial picture is better than none at all.

If daily conditions, factors, and circumstances are “change agents” that determine a business unit’s cash flow requirements and affect its bottom-line results, then would you not want to get some picture of how those “agents of change” are affecting the accounting statements in quicker time frames than the current ones in place now? Many of today’s accounting software programs can immediately generate some sort of preliminary statements with the push of a button, so why have you not added that to your weekly operational review checklist? Your views on how to use accounting statements must be parallel with the real world views, DAILY, because the change that is driving the supply-and-demand grid around your business unit can be viewed through these statements.

This is ground level thinking for “big picture” successful business building. You can make a difference in your business unit’s financial success by having the mind-set that your books close nightly.