by Amanda King | Business Coaches, Financial Analysis
As a professional advisor, multi-tasking runs through your veins. You’re a marketer, a financial advisor, and a confidant for your clients. You’re also business savvy. To make the financial advisor part of your job easier, we suggest you use financial analysis software. It gives you the ability to benchmark your client’s business performance against industry standards. Plus, it allows you to make timely, data-driven decisions. Financial analysis software adds value to you as an advisor. Maybe you’re already using a financial analysis tool, such as Excel. But hear us out – replace Excel with a Budgeting, Planning, and Forecasting software! If you graduate to a BP&F software, you can turn data into business insight. Excel also poses challenges in these areas: Security Control Consolidation Workflow Automation In contrast, here are the benefits of using a dedicated BP&F tool over Excel: Automates your annual budgeting process. Consolidates and centralizes a business’s financial information. Plans a company’s financial direction for the next three to five years. Documents how that plan follows through month-to-month and specifies expenditures. Forecasts finances using past company data to predict financial outcomes for the future. Promotes consistency across reports. And, nowadays, financial analysis is easy – if you use the right software. Just two years ago though, the reach of technology to financial advisors was severely limited. There were only a handful of players. Some of them were large platforms that had to be extensively adapted and customized to be relevant for financial advisors. But, eventually, software companies took advantage of this low-hanging business fruit. Today, there are many financial analysis software companies on the market. We sorted through...
by Amanda King | Business Coaches, Business Owners, Certified Public Accountants, Tools
Social Media Increases Product Sales & Brand Awareness The beautiful thing about using social media for your business is that it’s less expensive than traditional advertising avenues like billboards, radio spots or print magazine ads. And, there’s a way to track impressions and the click-throughs rates to your website, which allows you to understand how those results translate into return on investment. Professional service providers: here are our top three tips for using social media in order to grow your business: Hire a Skilled Social Media Manager, If Possible Even if you’re a small consulting firm, hiring a skilled social media manager to oversee your social media channels is crucial. There is a stigma that the field of social media is centered on creating content and simply posting it. But, there are actually a lot of creative and technical moving parts behind the scenes. And, when you’re busy focusing on business, you need someone on your team that has the skills to write creative marketing content, research, engage with brand advocates (followers who like your product or service so much they’re eager to tell others about it), and then analyze content – differentiating between what’s working and what isn’t. If hiring a social media manager isn’t in your budget, hire an intern. Many colleges and universities offer social media/social media marketing programs. The first class of students to go through these programs will most likely be graduating around the end of this year. Tapping these new graduates will be cost effective, as well. Identify and Engage Brand Advocates and Industry Influencers Whether you are able to hire a social media...
by Amanda King | Business Coaches, Business Owners, Certified Public Accountants, Resources
Key Financial Ratios Help Manage Your Business Your attention is usually focused on a key area within your company. Maybe that’s in marketing, sales or technology. Handling the financials may not be your forte. But, it’s important to be able to analyze your company using business profitability ratios. Financial ratios are used as indicators that allow you to zero in on areas of your business that may need attention, such as liquidity, profitability, operational efficiency, and solvency. Financial ratios are also useful tools in forecasting and financial analysis. They allow you to set specific goals and track your business’s progress toward these goals. It’s important to choose financial ratios that apply to your business. There are hundreds of financial ratios out there and while some of them apply to all businesses – there are some specific financial ratios by industry. Here are the top five most powerful and widely known financial ratios you should use in order to make your business succeed: 1. Net Profit Margin This ratio is the most important measurement. With this ratio, you can understand how each dollar earned by your company is translated into profits. How to Compute Profit Margin Ratio: Net Profit / Net Sales It indicates how efficient your company is at its cost control. For example, a higher Net Profit Margin means the business converts its revenue into actual profit more effectively. You can use this ratio to compare yourself to your industry peers, as well. 2. Current Ratio This ratio is a performance measurement of a company’s liquidity. The measurement determines if your business has enough resources to pay its debts...
by Amanda King | Business Coaches, Business Owners, Resources
How Financial Analysis Can Fuel Your Tactical Execution for Growth Successful business owners consistently evaluate the performance of his or her company and compare it to industry peers and competitors. But, whether you’re a business owner or an advisor, reading between the lines of financial statements is essential for the company’s tactical execution for growth. Analyze Financial Ratios Financial ratios are important financial analysis tools that can you help you implement action plans for profitability, leverage, liquidity and more. This is a traditional financial statement analysis tool. While ratios mostly report on a business’s past performance, they also act as a strategic predictor tool that pinpoints a business’s weak areas. Then, the owner can start improving this area in order to optimize growth. This gives you a 360-degree view of your business allowing you to look at past and present performance as well as financial projection for the future. Horizontal Analysis You can analyze financial ratios during your current financial period compared to the past year of your company’s financials. This is known as a horizontal analysis. The number of years you can compare financial statements will rely on the financial analysis software you are using. For instance, IndustriusCFO allows you to compare up to four years of financial statements (if you have four years’ worth of statements). This comparison will allow you to identify good and bad trends and adjust your business practices accordingly. When you compare your company’s financials to another company’s financials, you can see exactly how your ratios stack up against each other. However, if you’re analyzing a startup’s financials, you wouldn’t be able to...
by Amanda King | Business Coaches, Business Owners, Certified Public Accountants, Resources
Why You Should Be Benchmarking If you are a business owner, an accountant or business coach advising a growing business, measuring the company’s performance can help improve productivity and profit. Measuring performance keeps track of the business’s progress and gives you information to implement a target-setting system allowing you to strategize a plan for growth. Benchmarking a business is the process of evaluating it and comparing it to other businesses or internally based on measurements. It’s a great tool for improving your understanding of a company’s performance and potential. Who You Should Benchmark Against You can benchmark internally within the business. For instance, you can examine performance among departments within the company. Or you can compare the business to other businesses in the same industry. Yours or client’s company’s objectives and market position will also play a role in the comparisons you’d like to make. Info Entrepreneurs, a team of business information experts from the Board of Trade of Metropolitan Montreal says, “For example, a small business in a crowded sector may want to benchmark itself against average performance levels in the sector. But a business targeting rapid and significant growth may choose comparisons with an established market leader.” What to Measure Different industries and companies within an industry measure success differently. But, these financial measurements or benchmarks provide a quick evaluation of a business’s financial health: Net Profit Margin – This is the most important measurement. It is calculated by dividing net profit by revenue. By using this, you can understand how each dollar earned by the company is translated into profits. Liquidity Ratios – You should review two...
by Amanda King | Business Coaches
How to Add Value to a Company As a business coach, advisor or consultant, your role is much more than being a shoulder to lean on for support. A great consultant acts as a business tool and adds value to their clients, making them successful business owners. Here’s three of our top ways you can add value: Build Relationships “Get to know your client,” says Wendy Lydon, experienced Business Coach at ThistleSea Business Development in Pittsburgh, Pa. “If your relationship with your client isn’t authentic, coaching them won’t work.” The take away: Whether you are a small business, medium-large or large sized business coach, be yourself and don’t hide behind your computer constantly using email and your phone to have conversations with your client. It’s important to have face-to-face interaction with your client because your messages may get lost or misinterpreted through other modes of communication. Talking in person demonstrates the importance of your relationship. If a business owner can relate to you and respect you, you add value and delight your client. And, sometimes, life gets in the way and the client may need to vent about their personal life. Are you going to be the one to listen? Invest time into building a relationship that’s not solely based on business. Until the client can get over the pressures of every day life, business consulting can’t happen. Focus on Business By looking for issues and opportunities to improve the business’s performance, you have the power to affect your client’s profitability and improve operational practices. Using simplified business analysis tools like IndustriusCFO helps consultants view a blueprint of a business...
