Cash is not profit and vice versa
The goal of any business is to generate profit, and achieving this requires a thorough understanding of the difference between profit and cash flow. Net profit is the amount remaining after all business expenses have been subtracted from total revenue. Enhancing net profit involves adjusting the factors that influence both income and expenditure. For example, […]
Understanding your revenue drivers
To ensure your business remains profitable, generating consistent revenue is essential. This income is derived from your core business activities, such as making sales, receiving payments on invoices, or collecting cash from customers. The more effectively you sell your products or services, the higher your revenue will be. But what influences these revenue levels, and […]
Key ways to overcome rising costs and expenses
A recent survey revealed that 32% of Australian businesses consider increased operating costs among their top three concerns. Rising expenses can significantly affect your cash flow and profitability, making it essential to mitigate their impact on your business. How to Minimise the Impact of Increasing Costs on Your Business When costs rise and profit margins […]
The value of cashflow forecasting for your business
Forecasting your cashflow is crucial to ensuring the financial stability of your business. To effectively manage your cashflow over the coming months, it is imperative to undertake regular forecasting to establish a clear understanding of your future financial position. This proactive approach enables you to take the necessary steps to protect your cash reserves. Detailed […]
Succession planning for small businesses
Starting a business requires courage, but succeeding in today’s challenging economic climate demands a strategic mindset. Business owners are accustomed to managing risk and uncertainty, but recent economic conditions have amplified these challenges. Many owners are now faced with the difficult task of revisiting carefully crafted succession plans and exit strategies, potentially needing to consider […]
Making data meaningful in your business
Three Steps to Ensuring Data is Meaningful for Your Business Raw data encompasses the facts and figures that a business processes daily. Over time, every business accumulates a certain amount of data, which only becomes meaningful once it has been processed to add context, relevance, and purpose. For example, in a restaurant, each order is […]
Measuring the health of your business with ratio measures
When managing a business, it’s common to become absorbed in daily operations and overlook the broader financial landscape. Regularly evaluating the financial health of your business is crucial. Understanding your current financial position enables more effective planning, provides early warnings of potential issues, and allows for more strategic decision-making. There are key financial ratios that […]
Are you meeting your SMSF governance requirements?
Choosing to manage a Self-Managed Superannuation Fund (SMSF) gives you greater control over your investments and the flexibility to respond to market changes. However, it also comes with significant governance and compliance responsibilities. As a trustee, it’s essential to focus on the following five key areas: As an SMSF trustee, you must ensure the fund […]
Should you buy or lease your business assets?
When it comes to acquiring essential business assets—such as a delivery van for a home-delivery food service or a high-end digital printer for a print business—it’s crucial to determine whether purchasing or leasing is the most financially prudent option. Buying: Advantages and Disadvantages Advantages: Disadvantages: Leasing: Advantages and Disadvantages Advantages: Disadvantages: Consult with Us for […]
Following up on invoice payment in a down economy
Collecting payments on outstanding invoices can be challenging during economic downturns. However, maintaining a steady cash flow is crucial to ensuring your business can meet its financial obligations and cover operational expenses. During these times, it is essential to approach payment collection with empathy and maintain open lines of communication with your customers. Outlined below […]
