Philip Campbell's Blog

Is there a hole in your (financial) sidewalk?

I have a neat little story for you that captures the essence of what managing the cash flow of your business is all about.

The story comes from a book by Portia Nelson called “There's a Hole in My Sidewalk”. The author of this story was asked to write a summary of her life. And it had to fit on one page and be no more than five chapters long.

While you read this story, I want you to take a minute and get a vivid picture in your mind of what she is describing. I want you to see this story in your mind as the story of her life unfolds.

AUTOBIOGRAPHY IN FIVE SHORT CHAPTERS

Chapter 1

I walk down the street.

There is a deep hole in the sidewalk.

I fall in.

I am lost . . . I am helpless.

It isn’t my fault.

It takes me forever to find a way out.

Chapter 2

I walk down the same street.

There is a deep hole in the sidewalk.

I pretend I don’t see it.

I fall in again.

I can’t believe I am in the same place

But it isn’t my fault.

It still takes a long time to get out.

Chapter 3

I walk down the same street.

There is a deep hole in the sidewalk.

I see it is there.

I still fall in . . . it’s a habit.

My eyes are open.

I know where I am.

It is my fault.

I get out immediately.

Chapter 4

I walk down the same street.

There is a deep hole in the sidewalk.

I walk around it.

Chapter 5

I walk down another street.

 

That’s the story of her life!

And it also describes the essence of what managing your cash flow is all about. And really what managing the financial side of your business is all about.

You can do a poor job of it and let it hold you back and pull you down and make it harder to be successful in business. Lots of people let the financial side of their business become the hole in their sidewalk.

The result is the business becomes more difficult to manage than it needs to be.

Time to Walk Down Another Street

The alternative is to be smart about financial management, keep it simple, and walk down another street altogether when it comes to taking control of your cash flow.

Think for just a minute about all the blood, sweat, tears, dreams and MONEY you’ve invested in your business.

You owe it to yourself, and all the people who are depending on you, to be smart about how you manage the financial side of your business.

 

Note: My Freedom From Student Loans Blog is up now. Check it out if you or your children will be going to college or if you (or a loved one) have student loans. It’s there to help you.

Creating confidence by sharing the key drivers of your financial performance

The typical monthly financial reporting package just provides the basic financial statements (although many tend to leave out the cash flow statement which is a big mistake).

You provide real insight for the user though when you help them see and understand the handful of key drivers of your financial performance.

It promotes a deeper understanding of your business. It makes them smarter about how your business generates results.

It helps them to more easily understand the parts of the business that have the most impact on your financial performance.

I like to provide a Monthly Confidence Package to management and lenders and the Board of Directors.

It’s a great confidence and trust builder.

You should try it!

The new Freedom From Student Loans blog is up and running

I’ve mentioned to you in previous posts that I was launching a new blog – Freedom From Student Loans. Well, now it’s up and running and I’m ready to share a very important message with you.

I can’t tell how excited I am to be sharing this information about student loans with you. I truly believe that I can help you avoid some serious financial mistakes in your life as you work on getting your education, or helping your kids get an education.

My whole purpose with my student loans blog is to convince you to seriously consider outlawing the use of student loans in your family.  I want to show you why it is so important that you avoid student loans and that you do everything in your power to convince your children to avoid them as well.

It could be the smartest financial decision you ever make.

And it could be one of the most important, and long-lasting, financial lessons you ever teach your kids. What a powerful gift that would be for your kids and their family. To live their life without the anchor of student debt dragging them down is a valuable gift indeed.

I Want to Help

I'd like to see you win financially in life. Freedom from student loans is an important part of your journey toward winning in life. I hope I help in some small way in your success along that path.

Be sure to drop your email address in the box at the top right corner of the blog so you can get these blog posts delivered direct to your email inbox shortly after I post them. I will post two to three times per week.

And please share the blog with your friends and followers who you think will benefit from my message of freedom from student loans.

Here’s a link to sign up for email updates to that blog.

And here’s a link to the new blog.

I hope you enjoy it.

There is a lot of cash hiding in your inventory - time to unlock it

Have you taken a good, hard look at your inventory lately? Inventory can suck a lot of your cash into it if you are not watching it like a hawk.

Any dead bodies sitting (so to speak) in there?

Any old, tired products that need to be sent on their way (marked down and sold)?

Most companies are sitting on inventory that is not worth as much as it shows on their balance sheet. It’s kind of a way of avoiding the reality of your true gross margins. But in most cases, if old and worthless inventory were written off, the real gross margins you are achieving are less than what you think.

Maybe a lot less!

Take some time to really peel the onion on what makes up the inventory balance on your balance sheet.

You may unlock a lot of cash by shining the light on that dark little place some of your cash is trying to hide.

Caine Monroy is a young entrepreneur with an amazing lesson to teach each of us

The spirit of the entrepreneur is an amazing gift. I have had the good fortune to work with some amazing entrepreneurs in my career. I got to see firsthand how they turn their dream for a business into reality through vision and hard work.

Well, I have a treat for you today. Here’s a story of a young kid who has the spirit of the entrepreneur. It will put a huge smile on your face. It will probably even put a few tears of joy in your eyes as you watch it.

And the story even provides an example of the value of helping a young person succeed in business. And the power of social media to get attention.

It’s the story of young Caine Monroy and how he created Caine’s Arcade.

Check it out here http://cainesarcade.com/

You’ll love it!

Becoming a success in business presents some fun (and rewarding) opportunities

Being successful in business is both fun and rewarding. (And not just financially rewarding.)  It also gives you the ability to share what you have learned and to help other young business people along their path to success.

I remember some years back (2004 to be exact) when I was finishing up my first book about business, Never Run Out of Cash: The 10 Cash Flow Rules You Can’t Afford to Ignore.

Seth Godin Helped Me

I needed some big name authors to provide a “blurb” for my book that I could include on the front and back cover. I sent an email to Seth Godin because I loved his books Permission Marketing, Purple Cow, and The Bootstrapper’s Bible (you can read this one free on Seth’s web site).

He had no idea who I was. But he replied to my email almost immediately and agreed to take a look at the book. I sent it to him and he provided me a blurb for the book. A big name author helping out a guy writing his first book. That was super cool.

Brian Tracy Helped Me

I did the same thing with one of my favorite authors and audio program creators, Brian Tracy. There is no telling how many of his Nightingale Conant programs I have listened to as a young business guy wanting to learn and grow. He was a hero to me.

I sent him an email and he did the same at Seth Godin. He agreed to take a look at the manuscript. I sent it to him and got a handwritten blurb back in short order.

That always made an impression on me that big time authors would invest some of their time to help someone who wanted to learn and grow.

So I made a commitment to myself to do the same for others as those opportunities arise.

Who Can You Help?

I hope you will do the same for a young business person who would like to learn from you. What a very special gift you would be giving that person.

Just think how fun it would be to share a small bit of your success and wisdom with those who follow and admire you.

The smart way to evaluate an acquisition opportunity

Acquisitions can be fun and exciting and a great way to grow your company quickly. One of the first lessons you want to learn though when considering an acquisition is to recognize this important fact – it’s almost impossible to overcome a bad purchase price.

Meaning that paying too much for an acquisition can be deadly.

It’s kind of like buying real estate. You make your money on the buy, not the sell. Buying at the right price makes it possible to sell it later at a price that yields a nice profit.

Here’s the Secret

When evaluating an acquisition opportunity, make sure you have a number of different people (and personality types) assisting you.

Some of the biggest mistakes I have seen entrepreneurs make is they tend to look at the deal only through rose colored glasses. The problem is you don’t get a complete look at the business and the related risks when you look at it through only one lens.

You want to evaluate the deal from every angle. From the upside to the downside. The ins and the outs. The pluses and the minuses.

Trust me; you don’t want to have to try to dig out of a bad purchase price. It will more than ruin your day!

17 tips for surviving a cash crisis in your business

Nothing can challenge the very existence of your business like a cash crisis. Lenders are raising hell. Vendors are threatening to stop shipping. Employees are scared to death. It puts the pressure on you like nothing else can.

Having seen that scenario unfold many times during my career, I wanted to list a number of tips that I have found helpful in weathering the storm.

Here they are:

1. You have to have good numbers (financial statements)
2. No flying blind
3. Pay the government
4. Create visibility about what’s going on financially
5. Put the financial reality on paper
6. Don’t hide
7. Be accessible
8. Be proactive
9. Understand your strengths and weaknesses
10. Get help on the areas you are not comfortable with
11. Provide fast and accurate financials
12. Track cash daily
13. Have daily or weekly cash projections
14. Answer requests quickly
15. Have a weekly update call
16. Don’t over commit
17. Keep everything legal and ethical

Let me know if there are specific tips in that list you would like me to expand on.

Good luck!

 

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Understanding Your Cash Flow – In Less Than 10 Minutes a Month

In my new online course I show you how to understand your cash flow in less than 10 minutes a month. And l teach you how to explain what happened to your cash last month to your business partner or CEO (maybe even your spouse) in a 2-minute conversation.

Wouldn’t it be wise to know what happened to your cash last month? Less than 10 minutes a month is all it takes. I provide a 100% money back guarantee to prove it to you. You love my new online course… or I eat the cost.

Learn more here. Or BUY IT NOW on PayPal’s safe and secure servers for only $49.95 with my 100% money-back guarantee.

Cash flow planning is all about setting cash balance goals and creating projections

We all know and agree that cash is the lifeblood of your business. If the cash ever runs out, then your entire business goes down the drain.

That’s why it is so important to know what your cash balance is now and what you expect it to be six months from now. That’s what my book Never Run Out of Cash is all about.

Having Cash Balance Goals

The goal is to make money. If you are not generating cash in your business, then you are not achieving the objective. In fact, the ultimate measure of your success in business will be determined by how much cash you create and how much of that cash you hang on to.

Therefore, you must have a goal for exactly what you want your cash balance to be.

Having specific cash balance goals will solidify in your mind exactly what you need the business to do for you financially. Your focus on cash will have an amazing impact on your ability to create a business that takes care of you financially. And that's the objective, right? 

Seeing Problems Before They Happen

Joe Frazier, the famous boxer, said "The punch that knocks you out is the one you didn't see." What Joe Frazier was saying is that in boxing, if you see the punch coming, you have a chance to react. You have a chance to get out of the way. You have a chance to at least "roll with the punch." It's when you don't see the punch coming that you get knocked out.

In business, you can't have a punch (a cash flow problem) show up at the last minute, when you didn't see it coming. This kind of surprise blow will knock you out. It could be the kind of blow that ruins your business.

Cash flow projections are the key to avoiding a nasty surprise.

8 great tips for perfecting your pricing strategy (and improving your profitability)

How you set the price of the products and services you sell could be the difference between the success or failure of your business.

Get it wrong, and you create a problem you may never overcome.

Get it right, and you dramatically increase the likelihood of creating a business that takes care of you financially.

There Are a Number of Moving Parts

Setting prices takes careful thought, analysis and testing. There's no one-size-fits all strategy here, but a number of elements to consider to arrive at a price for your product or services.

You must:

• Determine what you want to achieve with your pricing strategy;
• Evaluate what you're currently charging, and whether or not it's working;
• Compare your strategies to competitors';
• Understand how your product is perceived in the marketplace;
• Align your product with market perception;
• Analyze pricing strategies, constantly; and,
• Be prepared to increase your prices when necessary. 

A Short Tutorial

I wrote a tutorial for Inc. Magazine a while back that they turned into a really sharp online presentation titled Perfecting Your Pricing Strategy.

Click on the link to check it out. It only takes a few minutes to watch the presentation.

The tutorial goes into more detail on each of the steps involved in getting your pricing strategy fine-tuned.

It also includes a number of worksheets you can download at no cost to help you put the strategy to work in your business.

Getting your prices set (and adjusted) properly is critical to driving your profitability and cash flow higher each year.