Financial MASTERY Workshop
NOVEMBER 23rd
2010
”The Language of Business is Finance!”
Warren Buffet – Worlds Top Investor
“If you don’t understand the Language
how do yo...
Profit
Margins
Up Sell/
Cross Sell
Enquiries Conversion
Rate
Life Time
Value
5 Components of Your Business Engine™
Score t...
What are Your Beliefs about Money ...?
3 Critical Areas of YOUR Financial Wealth in
the Business ...
Net Profitability
Sales & Turnover
Balance Sheet Value
1
2
3
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Getting to Break-Even & Beyond
£2,500,000
£2,000,000
£1,...
What Profit Per Hour (PPH) Do you Need?
£100K
2000
hrs= £50 / hr
x£1m
2000
hrs
£500 /
hr
Review Your Business Finance Dashboard™
Financials
Budgets
Cash flow
Cash Gap
Overdraft limits
% Profit Margin
Balance she...
Your Profit Pipeline™ - Where are You Leaking?
Productivity Pricing
Sales
Margin
Discounting vs. Increasing Prices …
Base Price
Base Price 10%
Discount
10%
Discount
10%
Increase
10%
Increase
How and Where to Raise Your Prices ...
• Just Do it!
• Raise Periodically – every 5 new
customers ...
• Split Test Pricing...
How and Where to Raise Your Prices ...
• Sell Product or Service Bundles
• Sell Higher Quality ...
• Create a New Niche & ...
Your Profit Pipeline™ ...
Productivity Pricing Cashflow
0 2
0
4
0
60 80 100 120 140
Payables
Receivables
Cash gap
Inventory
Where is the cash in
Avoiding The Cash Gap Crash™
Stoc...
Income/Rev/Sales
-
COGS/COS/Variable
=
Gross Profit
-
Exp/OH/Fixed
-
Owner Salary
=
Net Profit
+
Equity Inflow
=
Cash Posi...
Strategies to Cut Your Cash Gap ... Fast!
• Offer discount for early payments…
• Set Cash In Targets …
• Improve your Cred...
Your Profit Pipeline™ ...
Productivity Pricing Cashflow
What do you need to …?
Time to Plan You Actions
Financial MASTERY Workshop
NOVEMBER 23rd
2010
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Finance workshop 2010

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This a Presentation from The Business Wealth Club Members workshop on Finance in November 2010.

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  • Profit = Sales – Variable Costs (Cost of Sales, Cost of Goods Sold) – Fixed Costs
  • See the “Price Increase/Decrease” spreadsheet for other gross margins
  • 2 mins
  • Finance workshop 2010

    1. 1. Financial MASTERY Workshop NOVEMBER 23rd 2010
    2. 2. ”The Language of Business is Finance!” Warren Buffet – Worlds Top Investor “If you don’t understand the Language how do you keep Score?” Keith Cunningham – Creator of Keys to the Value & Tony Robins Wealth Coach
    3. 3. Profit Margins Up Sell/ Cross Sell Enquiries Conversion Rate Life Time Value 5 Components of Your Business Engine™ Score the pistons from 1 – 10 (1 being lowest and 10 being highest)
    4. 4. What are Your Beliefs about Money ...?
    5. 5. 3 Critical Areas of YOUR Financial Wealth in the Business ... Net Profitability Sales & Turnover Balance Sheet Value 1 2 3
    6. 6. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Getting to Break-Even & Beyond £2,500,000 £2,000,000 £1,500,000 £1,000,000 £500,000 £0 (£500,000) (£100,000) Revenue Total expenses Variable costs Fixed costs Net Profit Break even Net profit Max Utilisation
    7. 7. What Profit Per Hour (PPH) Do you Need? £100K 2000 hrs= £50 / hr x£1m 2000 hrs £500 / hr
    8. 8. Review Your Business Finance Dashboard™ Financials Budgets Cash flow Cash Gap Overdraft limits % Profit Margin Balance sheet Cash Flow Debtors Creditors Average Payment Days Sales pipeline warning Keep track of incoming work Cash in Bank
    9. 9. Your Profit Pipeline™ - Where are You Leaking? Productivity Pricing Sales Margin
    10. 10. Discounting vs. Increasing Prices … Base Price Base Price 10% Discount 10% Discount 10% Increase 10% Increase
    11. 11. How and Where to Raise Your Prices ... • Just Do it! • Raise Periodically – every 5 new customers ... • Split Test Pricing Models ... • Increase shipping or carriage charges ... • Survey customers ... • Demonstrate a better ROI ... • Sell Larger Units ...
    12. 12. How and Where to Raise Your Prices ... • Sell Product or Service Bundles • Sell Higher Quality ... • Create a New Niche & Own it ... • Demonstrate more “Proof” ... • Volume / Time Based Model – Low cost Airlines ... • Set Sales Targets Based on Margin
    13. 13. Your Profit Pipeline™ ... Productivity Pricing Cashflow
    14. 14. 0 2 0 4 0 60 80 100 120 140 Payables Receivables Cash gap Inventory Where is the cash in Avoiding The Cash Gap Crash™ Stock arrives Cash paid Stock shipped Cash received your business?
    15. 15. Income/Rev/Sales - COGS/COS/Variable = Gross Profit - Exp/OH/Fixed - Owner Salary = Net Profit + Equity Inflow = Cash Position 100,000 - 75,000 = 25,000 - 15,000 - 5,000 = 5,000 + 0 = 5,000 75,000 - 56,250 = 18,750 - 15,000 - 5,000 = (1,250) + 0 = 3,750 50,000 - 37,500 = 12,500 - 20,000 - 5,000 = (12,500) + 0 = (8,750) 75,000 - 56,250 = 18,750 - 15,000 - 5,000 = (1,250) + 0 = (-10,000) 100,000 - 75,000 = 25,000 - 15,000 - 5,000 = 5,000 + 5,000 = 0 100,000 - 75,000 = 25,000 - 15,000 - 5,000 = 5,000 + 0 = 5,000 JAN 10 APR 10MAR 10FEB 10 MAY 10 JUN 10 Example of a Cash Flow Statement
    16. 16. Strategies to Cut Your Cash Gap ... Fast! • Offer discount for early payments… • Set Cash In Targets … • Improve your Credit Control Systems… • Streamline operations to complete jobs faster • Just in time ordering – small and often • Change your Terms & Conditions • Use debt collection services • Negotiate better terms • Research higher pricing
    17. 17. Your Profit Pipeline™ ... Productivity Pricing Cashflow
    18. 18. What do you need to …?
    19. 19. Time to Plan You Actions
    20. 20. Financial MASTERY Workshop NOVEMBER 23rd 2010

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