11: How a Lack of Financial Acumen Can Leave a Big Negative Impact on Your
Are you looking to become a more competent business owner by learning how to transform your business, so that it will eventually improve your valuation? If so then Join Nana Bonsu in this week’s Build Value By Choice where he chats with Jayne McQuillan of Journey Consulting. Find out all about billing cycles, cash flow, and how cash flow differs from profitability.
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KEY TAKEAWAYS
You should monitor cash flow report every month. Not just monitor it, but really understand it.
Monitor Accounts Receivable; Accounts Receivable Aging; and Accounts Payable reports every week.
How and when are you billing. You should know how quickly you’re paying and if you’re paying in advance. Keep good relationships with your suppliers but slow down how you send cash out.
Sit down with your accounting team to understand how they put the numbers together.
Understand EBITDA on your income statement. EBITDA is Earnings Before Interest, Taxes, Depreciation, and Amortization.
Factors that impact your EBITDA include having systems and documentation, recurring revenue, a competent management team among others.
BEST MOMENTS
‘During the financial crisis many profitable businesses went out of business because they didn’t have cash’
‘Slow it down but maintain relationships with your suppliers’
‘It’s better to take a hit on the tax side rather than the value side’
EPISODE RESOURCES
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Training mentioned on the interview: Financial Acumen Training | Journey Consulting
Books mentioned on interview: Seeing the Big Picture by Kevin Cope; Unscramble Your Numbers by Amanda Fisher; Built to Sell by John Warrilow
ABOUT THE GUEST
Jayne founded Journey Consulting in 2007, combining her passion for business with her passion for people, to comprehensively serve the needs of family owned and privately held businesses. Her passion for business has roots in her extensive experience first at Price Waterhouse in Milwaukee and later in executive roles with several family owned and privately held businesses. Those experiences gave her incredible perspective on the needs and challenges business owners face in an increasingly competitive and uncertain environment. They also taught her how to be successful despite external conditions.
Jayne is a recognized expert in exit planning. She is a Certified Exit Planning Advisor (CEPA) and one of the elite advisors for exit planning in the country. She was instrumental in establishing the northeast Wisconsin chapter of The Exit Planning Institute. She strongly believes in educating owners on the exit planning process. Proper planning and business strategy add value to the business and gives the owner flexibility and options.
JMcQuillan@journeyconsult.com
https://www.journeyconsult.com/
PODCAST DESCRIPTION
Hosted by Nana Bonsu of Infinite Horizons, this show aims to serve small business owners who want to grow their businesses while reducing their own personal involvement. We do this through a combination of interviews with industry leaders, and host presentations. We are a certified value builder advisors and leverage a statistically proven methodology to help clients such as you scale or transition their business to the next chapter.
We care for our listeners and see their dreams as our own. We aim to foster a community that embraces freedom, generosity, and integrity. This is a show by entrepreneurs and business owners for entrepreneurs and business owners.
ABOUT THE HOST
Nana Bonsu:
“I am an entrepreneur and ex-Corporate Executive who’s applying his experience and knowledge from working in various to pursue my passion of helping small business owners increase their choices in life by leveraging my knowledge and experience, their employees, systems and money. I help small business owners transform their business and increase value through action-oriented education and implementation of strategies and tactics to make their business sellable even if they are not planning on selling. Known for establishing an environment for personal growth and development. My multicultural background equips me with the intuitive understanding of different cultures and how they impact business owners.”
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