Entrepreneurs and small-business owners are masters at their crafts. While honing their skills, oftentimes "running the business" can get pushed to the bottom of the list of tasks. This often leads to businesses being run from a checkbook as opposed to management controlled and budgeted for robustness during natural business cycles or crisis situations. Moreover, without proper training, many of the business concepts that small business owners would find most helpful are not as easily understood. As champions of small business, we at Fortis Business Advisors want to provide entrepreneurs and small business owners tools to ensure they not only stay ahead of their competition but also scale through robust growth and profitability.
OPTIMAL INVENTORY TURNOVER
While maximum profitability remains key, in today's environment rapid and efficient inventory turnover can not only turn low-margin products into cash drivers but also ensure price competitiveness.
The efficient use of working capital, in both healthy and crisis situations, is key to a business's survival. Managing the cash cycle and the impact of its components will ensure a management controlled organization.
Considered a margin of safety, break-even defines the level of volume a business must reach to cross the profit threshold based on the associated costs. Once break-even is achieved management gains complete control.