Accrual vs Cash Accounting: which method should you use?
There are two types of accounting methods accrual and cash accounting. Which type your company uses can have a major impact on the total revenue and expenses that appear in your financial reports. Typically cash-basis accounting is used by smaller businesses who prioritise simplicity. Using cash-basis accounting a company records expenses and income as the […]
Financial Performance – How To Assess It For Your Business
One of the most common questions we get asked is “Am I making enough money” or to put it another way “How much profit should I be making”. This video shares a simple but powerful process to assess the financial performance of your business. So what is the financial performance of your business? Financial performance is […]
Product lines…how much profit is enough?
In my work advising business owners I’m often asked the following question – “how much profit should I be making?” Or to put it another way, “how much profit is enough?” Often a business owner will advise me that they’re making a certain gross profit margin (GP margin) or certain net profit. Sometimes, the GP […]
Salaries vs Dividends vs Drawings: What’s the best option and why?
Unless you’re running your business as a sole trader, the time will come when you must decide how you will remunerate yourself for your time, efforts and entrepreneurship. The profits of your business belong to the company operating that business, not to you. But there are various ways in which you can extract the value […]
The key financial metrics you need to know to achieve financial success
Measuring the right financial metrics is key to the ongoing health of your business. They can provide important insights into how well your business is doing, and allow you to make informed decisions to maximise your growth into the future. If you want to keep your business on track, you simply cannot ignore the process […]
Businesses use of long-term funding to finance assets: why, how, and what to do about it?
Managing the cash flow of a business is definitely one of the most important tasks of being a business owner. Prudent business owners regularly look at updating vital business equipment to take advantage of efficiencies that are created by newer technology. Choosing the right type of asset finance to fund this equipment can help save […]
Effective strategies to better debtor management in six simple and easy steps
When you’re busy growing your business it can be easy to neglect managing your debtors – but good debtor management is critical to ensuring your business has enough working capital to reinvest and grow. Here are six simple steps to help you effectively manage your debtors. 1. Have a credit policy and terms of trade […]
Strategy implementation: 6 reasons why it doesn’t happen
Formulating a strategy for your business means defining and setting your business’ mission, objectives or goals, and stating how you plan to achieve them. But while many organisations commit time and money to formulate great strategies, they often fail to turn ambition into reality. If the execution or implementation of your strategy fails, all your […]
3 wealth management strategies to safeguard the future of your business
The best way to create wealth will depend on your personal and business circumstances – and the same is true when it comes to protecting that wealth for the long term. There’s a lot to think about when you’re deciding on a strategy for building and managing your wealth. Here are the key topics you […]
How to value a business for sale
If you are considering selling your business, either now or in the future, it’s important that you understand how to value a business. The challenge for many small business owners is that emotions often play a big part in their assessment. And that’s often for good reason: a passion for whatever it is that the […]
