Easy Money: Merchant Loans and 2/10 Net Thirty Payment Terms
Easy Money: Merchant Loans and 2/10 Net Thirty Payment Terms

I suspect that most of us could use an extra $100,000 in cash.  It would sure be nice to have cash to pay down the line of credit, get current with suppliers, or catch up on payroll taxes. Access to easy cash makes so-named merchant loans pretty attractive.

You know the loans, they’re the ones where they make a few cursory checks of your credit score and bank statements then wire money directly into your account. Presto, cash problems resolved (for the time being anyway).

Sounds too good to be true doesn’t it? It is.

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Martin HollandComment
Break Even Analysis: What is it and Why it Matters
Break Even Analysis: What is it and Why it Matters

Break even sales is the point at which we’ve sold just enough to pay all of our expenses, with nothing left over for profit. In other words, it’s the point at which profit and loss equal exactly zero. It turns out that breakeven is among the most powerful tools we have for making management decisions.

I understand that a lot of us don’t like numbers, but these are just too important to ignore. If you plan on succeeding in business, suck it up. Sacrifice the few minutes it takes to understand.

 

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Martin Hollandbreak even analysisComment
Raising Cash for Growth
Raising Cash for Growth

All of us in business owners are concerned with cash.

We are under constant pressure to balance a limited supply of cash with the seemingly unlimited demand from cash-consuming sinkholes such as operating expenses, accounts receivable and inventory - and that’s just normal operations.

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Martin HollandComment
The Four Fundamentals of a Successful Business
The Four Fundamentals of a Successful Business

All of us want to build a successful business, either to reach our potential or to reduce our suffering, or both. We all want to improve our companies, but few of us devote meaningful time or attention to doing it. 

First, we are so busy working in our businesses that we push it off to a “tomorrow’ that never comes, and second, we don’t really know how to go about it. 

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Martin Hollandsuccessful businessComment
Why Businesses Fail
Why Businesses Fail

You want to know why businesses fail? This is why. If this had happened last year when we were restructuring, it would have been the end of us.”

 

I was talking to a friend who owns an agency in Dallas. He had just dodged a potentially fatal bullet in the form of a sales tax audit, and he did it by writing a $32,000 check.

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Martin Hollandwhy businesses failComment
How Much Does it Cost?
How Much Does it Cost?

“How much does it cost?” Such a simple question.We all want to know our costs because that’s what we subtract from sales to see if we made a profit. No problem there, just add up all our expenses and that’s our total cost. But many of us also use cost to price our bids and products.

That requires a different understanding of cost, and that’s where the confusion sets in.   

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Martin HollandHow much does it cost?Comment
How to Negotiate on Price: Don't
How to Negotiate on Price: Don't

In our pursuit of more sales, most (all?) of us have resorted to price concessions - discounts. Many of us still do. We do it, of course, in the belief that customers will close more deals if we’re “flexible” on price.

That may be true, but it is also true that discounts can devastate our margins and profit, and, even though we sell more, we wind up working harder for less profit.

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Martin HollandPrice concessionsComment
Reassuringly Expensive
Reassuringly Expensive

I am a business coach by trade, but I am also an amateur painter. I learned a lesson from that hobby that I’ll never forget.

I said: ”I know what you’re thinking.”  “Oh?” she responded, “What’s that?”  “You’re thinking that’s a lot of money for a painting. How about I knock 20% off the price?” “Thanks,” she said. “I’ll take it. But just so you know, I was thinking about how to get it home. I measured, and it won’t fit in my car.”  

Ouch!

 

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PRODUCTIONMartin HollandMargins, Price Increase, USP, fear, price increase, head trashComment
The Balance Sheet - the Ultimate Scorecard
The Balance Sheet - the Ultimate Scorecard

Could you imagine Russell Westbrook, the 2017 NBA MVP, playing without a scoreboard? No doubt he would play hard all the time, but he plays differently when he knows the score. We know that because he is constantly checking the scoreboard for the score, fouls, time remaining, time outs - the information he needs to manage his game.

The Balance Sheet is the ultimate scorecard for business. As a business coach, I’ve noticed that owners, like Westbrook, manage their businesses differently when they understand the score.   

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ADMINISTRATIONMartin HollandBalance Sheet, Assets, Liabilities, Equity, Net Worth, Statement of Cash FlowsComment
5 Things You Need to Know About Your Income Statement
5 Things You Need to Know About Your Income Statement

“Our income statement shows we’re making a profit, but it sure doesn’t feel like it.”

It was a contractor’s wife who had a pretty good feel for how their business was going.

The P&L and the math are simple, but depending on how they’re prepared, P&Ls can show wildly different results. To get an accurate, useful report, we have to understand what goes into it and why it matters. My experience as a business coach has shown that there is a lot of confusion about that.

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ADMINISTRATIONMartin HollandP&L, Income Statement, Matching, Accrual Basis, Cash Basis, Income, Expense Comment
Financial Reports Explained Without Numbers or Math
Financial Reports Explained Without Numbers or Math

There is a saying often attributed to Edwards Deming that “We cannot manage what we do not measure.”  Numbers are the measurement that make management possible. The corollary of the quote is:  “If we don’t manage it, everything that happens to us – good or bad - is an accident.”  We might survive by accident, but we cannot thrive, which means we cannot thrive without numbers.  

Now don’t panic. As business owners, WE do not have to collect and compile numbers. We don’t even have to know how it’s done, but we do have to understand what numbers tell us.

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ADMINISTRATIONMartin HollandFinancial Statements, Income Statement, Balance Sheet, Statement of Cash Flow, subjective. ObjectiveComment
Five Steps to 61% Higher Profits
Five Steps to 61% Higher Profits

“What parent,” he asked, “wouldn’t run into a burning house to save his child?”

It was my mentor describing what he called Save the Baby Syndrome.

“But that doesn’t make good parents,” he continued.

“It’s the little things like regular bedtimes, brushed teeth, homework and curfews that make good parents - and good kids.”

The same is true in business.

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CUSTOMERSMartin Holland5 ways, leads, conversion rate, average number of transactions, average sale, margins, profitComment
How to Avoid Discount Disaster
How to Avoid Discount Disaster

“I’m planning on running a promotion this weekend.” It was a former client of mine who owned a retail store in a university town.

“What sort of promotion?” I asked.

“I don’t know. I've been thinking maybe a 25% percent discount on everything in the store. There’s a game this weekend and I want to pack ‘em in.”

“Are you open to discussion?" I asked.

“Sure, what do you have in mind?”

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CUSTOMERSMartin HollandDiscounts, margins, gross profit, discount calculatorComment
Alignment: How to Prevent Culture Shock
Alignment: How to Prevent Culture Shock

“It's important to keep the right people on the bus, but more important to keep the wrong people off.”- Reed Hastings CEO, Netflix

When I first met the founder, he had grown his company from start-up to eight-digit annual sales in under nine years. It appeared to be a tremendous small business success story, but things were not entirely what they seemed.

The company had an insidious flaw which even now threatens to destroy it.

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GUIDANCEMartin HollandValues, alignment, behavior, vision statement, culture statementComment
How to Set and Achieve Powerful Goals
How to Set and Achieve Powerful Goals

My father piloted one of the first American airplanes to land in Japan after their surrender in WWII. As he parked the C47 cargo plane, a Japanese man approached on a bicycle.

Hanging from the top tube of his bike was a sign that read “Watanabe Trucking Company.” He was looking for work.

“Do you even have a truck?” asked my father through an interpreter.

“No,” replied the man, “but my son will.”

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GUIDANCEMartin HollandVision, Goals, TimeComment
How to Make Time to Manage Your Time
How to Make Time to Manage Your Time

As a business coach, I often quote Mark Twain who is rumored to have said: “I don’t want to know when I’ll die, I want to know where.” His point, of course, was that he could influence his location, but not time. He was right that we can’t influence time, but we can certainly manage our allotment.

Managing time is work until it becomes habit, and work requires incentive. Jim Rohn says that ”If the promise is apparent, the price is easy.” His genius was saying in simple terms what we all know is true: If we are complacent, unimaginative or completely satisfied, we will not do the work necessary to change.

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GUIDANCEMartin HollandTIME, TIME MANAGEMENT, PRIORITY, MULTITASKING, DEFAULT CALENDARComment