It will blow your mind if you know how your business is being hurt just due to the lack of financial discipline. Do you have someone that helps you stay financially disciplined both in your business and personally? Do you listen?
As you can easily imagine, the client I’ve recently been writing about who lost millions in the sale of his business did not have good financial discipline. Fast facts to consider:
Fancy presentations, fast talking and nice smiles will not hide that you have bad personal credit, pay your creditors slowly, leave no money in the business, and overpay yourself. In general, good investors do their homework and recognize poor fiscal management in a business.
When partners and fellow leaders see you draining money from the business (and they will), they lose momentum because they feel that their hard work is going to waste. This then develops into an entitlement issue: the aggrieved parties demand much higher salaries, which either turns into further dilution of cash or further loss of productivity. Either way you lose.
If you create budgets and don’t adhere to them, they do not really exist. With rare exceptions for outstanding individual contributions, there should be no raises unless the company is growing. If the company is growing less than forecast, raises should be commensurately lower.
Pay particular attention to your balance sheet. Cash is king. Cash is where you build your ability to grow and handle unforeseen circumstances.
If you are interested in maximizing the growth and profits of your business, let’s schedule a time to further discuss your business. Call Howard Shore for a FREE consultation 305-722-7213 or contact Activate Group, Inc. today.