Adviant Financial Comparison to Benchmark This is an important metric. In fact, over This number indicates the percentage of sales time, it is one of the more important revenue that is not paid out in direct costsbarometers that we look at. It measures how (costs of sales). It is an important statistic that many cents of profit the company is can be used in business planning because it This metric shows G & A payroll expense generating for every dollar it sells. Track it indicates how many cents of gross profit can for the company as a percentage of sales.carefully against industry competitors. This be generated by each dollar of future sales. is a very important number in preparing Higher is normally better (the company is more forecasts. The higher the better. efficient).
Bright Blue Marketing Financial Comparison to BenchmarkThis is another good indicator of liquidity,although by itself, it is not a perfect one. Ifthere are receivable accounts included in thenumerator, they should be collectible. Look This ratio shows the average number ofat the length of time the company has to pay This number reflects the average length of days that lapse between the purchase ofthe amount listed in the denominator time between credit sales and payment material and labor, and payment for them.(current liabilities). The higher the number, receipts. It is crucial to maintaining positive It is a rough measure of how timely athe stronger the company. liquidity. The lower the better. company is in meeting payment obligations. Lower is normally better.
Solace Networks Financial Comparison to BenchmarkThis Balance Sheet leverage ratio This ratio measures a companys Generally, this metric measuresindicates the composition of a ability to repay debt obligations from the overall liquidity position of acompany’s total capitalization -- the annualized operating cash flow company. It is certainly not abalance between money or assets (EBITDA). perfect barometer, but it is aowed versus the money or assets good one. Watch for bigowned. Generally, creditors prefer a decreases in this number overlower ratio to decrease financial risk time. Make sure the accountswhile investors prefer a higher ratio to listed in "current assets" arerealize the return benefits of financial collectible. The higher the ratio,leverage. the more liquid the company is.
Nitro Marketing, LLC Financial Comparison to Benchmark Actual thru Measurement June 2010 BenchmarkIncome StatementSales (Income): $ 2,138,350Cost of Sales (COGS): 381,283Percent of Sales 17.8% 30.4%G & A Payroll Expense (optional): 622,092Percent of Sales 29.1% 32.4%Net Profit before Taxes: 196,160Percent of Sales 9.2% 8.7%Other Metrics:Sales per employee $ 388,791 $ 185,868Return on Assets 178.4% -0.1%Comments:G&A Payroll is increasing. Should understand why.Are income taxes being planned for?Is a credit line available to help address uncertainty?Does the business owner have clarity for the future?his appears to be a significantly valuable company. Protect yourself.Excellent cash flow with little working capital used for the business.
BreakSmall Groups should discuss their reports and generate questions - 30 minutes?
4 Stages of Cash Stage 1: Infrastructure Creation Owner’s Activities• Building relationships with customers• Creating relationships with vendors• Delegating tasks to employees or associates• Causing sales and cash to come into the company
Stage 2: Infrastructure PeakThe result of Infrastructure Creation is Infrastructure Peak• Few customer complaints• High customer service• Low overhead• Company runs “lean and mean”• Short cash collection cycles• Personal sacrifice by the Finder
Stage 3: OutgrowthResult of running lean is burn-out of owner and employees Attitudes change, owner thinks: “I should have a raise” “We need more people so we can take time off” “We need a better building” “I need a new car/house/vacation……” “We should buy more equipment or inventory”
Goal clarityIncreased profits and cashTrusted long term advisorSeasoned partnersNo contractNational partner resources