Ensure Good Returns on Your Investment
Ensure Good Returns on Your Investment
To be a business – that is, ‘a commercial, profitable enterprise that works without you’ --your business must give a good return on investment plus a full wage for every hour you spend working in your business. You can then pay someone to do your job and the business profits are not affected.
The quote ‘if it doesn’t add up, don’t do it’ can be applied in all areas of your business. Advertising is a prime example. If an ad is run and does not get an immediate response, there is no point in keeping that ad running. It is wasting precious time and money. Change the ad or where it is running.
Increasing your team must also add up in dollars. Perhaps a business should consider setting training and operating systems in place so juniors can be hired to follow the systems, rather than hiring seniors who have the head knowledge of how it should be done. Alternately perhaps the business should look at new machinery or technology instead of more team members.
If you want to buy a business the figures also must add up – or have the potential to do so. Make a list of the criteria the business must fill and make sure this list is filled before you commit yourself. Many people buy into something believing it would fulfill their needs, to discover the figures were inaccurate or did not add up. If you are not sure, get help. Two heads are better than one, and prevention is better than cure.
A great idea when looking at a business is to check the industry average and see how your business compares. Given that four out of five businesses go broke in the first five years, you may want to be better than average.
Finally the bottom line where your figures must add up is in net profit margin. To get this figure a business must add all expenses, including an appropriate wage for all the hours put in the business, plus interest on the capital you put into the business. This will give your real margins.
‘If it doesn’t add up, don’t do it” must be applied regularly. Don’t wait until the end of the financial year to find if you have made a profit. Business is work, but it should also be fun
Ensure Good Returns on Your Investment - To learn more about this author, visit Warren Coughlin's Website.
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Business is all about making a profit, so if your business strategies aren’t adding up to business profits, don’t do it, or do it differently.
To be a business – that is, ‘a commercial, profitable enterprise that works without you’ --your business must give a good return on investment plus a full wage for every hour you spend working in your business. You can then pay someone to do your job and the business profits are not affected.
The quote ‘if it doesn’t add up, don’t do it’ can be applied in all areas of your business. Advertising is a prime example. If an ad is run and does not get an immediate response, there is no point in keeping that ad running. It is wasting precious time and money. Change the ad or where it is running.
Increasing your team must also add up in dollars. Perhaps a business should consider setting training and operating systems in place so juniors can be hired to follow the systems, rather than hiring seniors who have the head knowledge of how it should be done. Alternately perhaps the business should look at new machinery or technology instead of more team members.
If you want to buy a business the figures also must add up – or have the potential to do so. Make a list of the criteria the business must fill and make sure this list is filled before you commit yourself. Many people buy into something believing it would fulfill their needs, to discover the figures were inaccurate or did not add up. If you are not sure, get help. Two heads are better than one, and prevention is better than cure.
A great idea when looking at a business is to check the industry average and see how your business compares. Given that four out of five businesses go broke in the first five years, you may want to be better than average.
Finally the bottom line where your figures must add up is in net profit margin. To get this figure a business must add all expenses, including an appropriate wage for all the hours put in the business, plus interest on the capital you put into the business. This will give your real margins.
‘If it doesn’t add up, don’t do it” must be applied regularly. Don’t wait until the end of the financial year to find if you have made a profit. Business is work, but it should also be fun
Ensure Good Returns on Your Investment - To learn more about this author, visit Warren Coughlin's Website.
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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