Case Study – Put the spark back in your cash flow

The Problem

A large electrical contracting business had grown from $4M p/a revenue to $11M p/a revenue, while having their profit go from $1M p/a to $70K p/a.  They were investing in another larger commercial building for the business to move into and had a $1.5M renovation/building bill to pay over 9 months and were struggling with cash.  95% of jobs were now losing money, mainly due to incorrect pricing and small to no margins on the work. The business budget was simple and not really understood and there was NO cash flow constructed at all.

The business was struggling and heading towards bankruptcy (without the owners realising it) and creditors were only 2.5 months away from knocking on their door and closing the business down.

The Solution

The owner asked us to help them construct a budget and a cash flow from scratch.  Using the clients  business knowledge and having an honest objective look at the businesses past performance, we constructed a very specific budget with workings and assumptions.  This allowed us to gather real information and enabled us to progress forward.  We created a cash flow document based on reality and discovered a number of periods in the short and medium term that needed to be addressed.   We worked over a 5 month period and the owner looked into his business like never before with many “light bulb” moments and changes of opinion going forward.

The Result

With the clear knowledge of what the “real situation” was and the “extra time” the owner now had to save the business, the owner;

  • Received $2M funding from a private investor and saved the business from closing
  • They focused intently and converted $15M of new work at 15% margin within 3 months
  • They extended the building project from 9 months to 15 months
  • They saved themselves from losing the business 100%
  • They saved their family home from the banks as this was the guarantee of the business debt on their major projects

This is just one example of how we have worked with our clients to help them achieve a secure and successful financial future.

If you would like to know more about how you can work on your business, rather than just in your business visit the link http://www.youtube.com/watch?v=diHkP1Sn7vo and find out more about the exciting new

Business Mastery-The 10 Hats of Business Program

Or Visit the link and register for our FREE boardroom briefing sessions

http://www.mcmahonosborne.com.au/www/content/default.aspx?cid=1011&fid=976

 

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Take the time

Small business owners work extremely hard and very rarely stop.  They can become consumed by the day to day pressures of running their company which can lead to problems.

 A relentless focus on closing the next sale, keeping the books out of the red, and constantly putting out fires can be harmful to your business in the long term.  While ambition and drive are commendable qualities, there are times when it is necessary to take a step back and evaluate just where your business is at.

As a new year begins, this is the perfect time to do just that, to ensure that you have a successful year ahead.

Here are just a few tips to consider;

Hold a post mortem of your business-

Be sure to make an honest evaluation of just how your business navigated through the past year.

Did you have a successful year? 

In which areas did your business perform the best?

Are there areas that are holding you back or need to be changed?

Under the scope-

Now is the best time to put your systems and procedures under the microscope.  Have they moved with the times?  Are they efficient?  Don’t stick with inefficient business processes.

Get expert advice-

You should meet with your accountant/financial advisor on a regular basis.  These regular meetings can result in you getting a broader perspective on market forces that may impact your business.  In addition these meetings can help you map out money saving tax strategies.

These are just a few simple tips, if you would like to know more about how you can work on your business, rather than just in your business, visit the link http://www.youtube.com/watch?v=diHkP1Sn7vo and find out more about the exciting new Business Mastery- the 10 hats of business program.

Or Visit the link and register for our FREE boardroom briefing sessions

http://www.mcmahonosborne.com.au/www/content/default.aspx?cid=1011&fid=976

 

Proudly sponsored by-

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X–Factor your Business in 2014!

Virgin has it. Google has it. And so does Apple.

It’s the X-Factor – that indefinable characteristic

that makes businesses absolutely irresistible to consumers.

 For some of us, the X-Factor is that magic characteristic we all want in our business but have no idea how to get it. After many years of working with large and small businesses we have great news in saying that putting that X-Factor in your business doesn’t require a magic wand or million dollar marketing campaign.

Businesses with the Marketing X-Factor all excel in the following areas:

  • They have an irresistible brand that everyone wants to be associated with
  • They have a unique selling proposition that sets them apart from their competitors
  • They give customers an extraordinary experience every time they deal with the organisation
  • They maximise money spent by the customer (average dollar spend)
  • They are skilled at generating leads and tapping into potential customers
  • They always have irresistible promotional offers
  • They are skilled at writing words that sell
  • They enjoy excellent customer loyalty and strong repeat sales

The 8 points above reflect key performance indicators in your business and should be a strong area of focus in your business. Good lead generation, sales conversion, client retention or average dollar spend are some of the key ideas to maximising your bottom line.

Make these core areas the buzz word of your sales & marketing department, print them up and post them around your business to be reminded every day.

The important thing to remember is that achieving the Marketing X-Factor in your business is absolutely achievable – It’s not about theory based strategies or expensive marketing campaigns but simple practical application in the above. These can be implemented today and have a great impact tomorrow!

If you would like to learn more about making your business achieve it’s X-Factor, visit our website to find out more about our Business Mastery Program- the 10 hats of business commencing in February, 2014.