Tag: Financial Metrics
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[Monthly Metric] Growth Rate
What’s your current growth rate? “Growth is never by mere chance; it is the result of forces working together.” — JC Penney Of all the financial metrics, in all the towns, in all the world; your growth rate should come first. Nearly every move you make in business will flow downhill from whether you’re growing…
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[Monthly Metric] Tracking Collections with DSO
Metric of the Month: DSO “The first rule is that a measurement, any measurement, is better than none.” — Andy Grove This will be a new monthly series as part of our regular newsletter. There are too many financial metrics and most articles are long on definition, short on “what do I do with this?”…
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Pulling Levers
Turning 1 into 2 “Give me a place to stand, and a lever long enough, and I will move the world” — Archimedes Leverage can be beautiful (just ask your banker), but what is it? Getting “leverage” means creating a multiplier effect in your business. It’s exponential, not linear. It literally turns 1+1 into 3…
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Try Using This Underrated Financial Metric
Nice Assets “The goal is not to grow bigger; the goal is to grow better.” — Peter Drucker What’s your favorite underrated financial metric? (seriously, reply and let me know) Mine is the asset turnover ratio (total sales divided by total assets), and I finally came across a great example of it in the wild: fast-casual restaurant chain,…
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Working Capital 101: The Small Business Owner’s Guide
You’re probably sick of hearing about working capital. Every business has working capital and next to cash, working capital is the lifeblood of every business. (If you think you don’t have working capital in your business, please send me a note, I want to hear about it!). First, what is working capital? Here’s a Net Working Capital…