Small Business CFO Coaching and Consulting
I’ve never been a fan of any company stating they are a business of integrity on their website. I believe integrity is best caught rather than taught.
Accordingly, walking the talk versus talking the talk is far more attention-grabbing. And that’s why I want to give a standing ovation to one of the business developers at Pro Food Systems (PFS) in a recent meeting. But more on that later.
There’s a reason financial executives hate collecting (or chasing) money from slow-paying customers. We just hate it.
You say you enjoy it? You’re crazy!
In the name of chilling out on such a frigid topic, I thought I’d share some of the suggested column headings for your AR aging schedule.
I’ve been mentoring and coaching CEOs as their 1099 CFO and Controller since 2001. And here’s a question I can bank on after about our 128th meeting–“Mark, can you explain that cash flow statement again?”
Let’s start with a simple multiple choice question:
Which of the following statements is generally true with respect to cash flow statements?
A. Most CEOs do not undertand a cash flow statement.
B. Most CEOs focus primarily on sales, gross margins, and the bottom line.
C. Most CEOs are confused why cash is tight when earnings are strong.
D. In the budgeting process, most CEOs do not budget/forecast working capital, CapEx, and other key components of the balance sheet.
E. All of the above.
If you selected F, then kudos (hint–that means none of the above). You are a unique CEO (as in maybe your name is Dave Kellogg). But I don’t see F. Instead, did you select E? Then read on.
When I’m working on financial models, I like lots of flexibility. And that’s why I rarely use Excel for these projects.
I generally use one of two financial modeling tools–one of those is Quantrix.
Flexibility? Absolutely–more so than Tony Horton’s when he does Yoga X in P90X.
John Jorgensen possessed one of the greatest manufacturing minds that I have ever encountered. He was a long-time president of Orscheln Company and Ortech, both Missouri-based businesses.
One of John’s favorite business measures was ROAM, short for return on assets managed. He felt it was a holistic measure that best described the financial performance of a company because it was not a one-dimensional key result indicator.
While John served mid-sized businesses, I believe his opinion is applicable to small businesses.