by Paul Simister
on July 23, 2018
This is an article from P1M3 How Profit is Created in the Pillar 1 Your Key Numbers.
Monitoring Your Break Even Point Each Month
If your business has been losing money or you’re actively in a business turnaround process, I believe it’s important to calculate your break even point with each set of monthly management accounts.
You can do it on a month by month basis but, like a lot of financial statistics, it can go up and down and make it hard to see the trend.
Using Moving Annual Calculations
One option I like in practice is a calculate moving annual statistic for Break Even Points, partly because it’s normal to think in terms of performance in a year. [continue reading…]
by Paul Simister
on July 21, 2018
This is an article from P1M3 How Profit is Created in the Pillar 1 Your Key Numbers.
Understand The Financial Implications Of Your Decisions With What-If Analysis using the Cost Volume Profit Relationships
If you’ve worked your way this this Pillar 1 Module 3 systematically, then with what you know so far, you can start to look at the financial implications of some quite complex decisions.
Previously you’d rely on gut feel to make and worry about the possible consequences.
Now you can start looking at the facts and key assumptions and make a considered judgement, just like senior managers do in big businesses with full accounting and financial management support teams. [continue reading…]
by Paul Simister
on June 10, 2018
Financial Control means using financial measures (and other measures) to monitor the performance of your entire business system.
It avoids the ostrich system of you, with your head in the sand, not knowing what’s going on. [continue reading…]
by Paul Simister
on December 18, 2016
The full title of the book by Colin Mills is
Scale Up: How to Take Your Business to the Next Level Without Losing Control and Running Out of Cash
In my review posted at Amazon.co.uk, I gave it 3 Stars.
Here is my review.
A long promotion for the role of part time finance director
It’s promoting the role of the part time finance director (FD) or chief financial officer (CFO) in general and the FD Centre / CFO Centre in particular. It’s so promotional in fact that I feel it’s cheeky to ask potential customers to pay for it.
Fast growing businesses face challenges in terms of 1) keeping control of what’s happening in the business as the founder/owner has to delegate and 2) managing the strain on cash flow that is caused by growth. [continue reading…]
by Paul Simister
on October 18, 2007
In this article, I list eight common finance mistakes which could be harming your business.
Are you one of the many small business owners or managers who will admit that finance and accounting are not amongst your strongest skills?
If so, you may find it very worthwhile to check whether you are making any of these common financial mistakes that could be costing you a fortune.
Finance Mistake 1 – Accepting Losses While Building Your Business
It’s conventional wisdom that you will lose money during the early stages of creating a business and that period may last for up to three years.
While it is certainly true that you can have a lot of start-up expenses, you also need to accept that your business is in its infancy and you have to cut your cloth accordingly. [continue reading…]
