Most business owners have a loose idea of their unit economics (margin at the product level), but it’s usually: Your pricing strategy can make or break profitability… generally, I see companies fall into 2 buckets: those with revenue or pricing problems, and those with cost or expense control problems. Today, we’ll drill deeper into a pricing concept…
How do you know whether you have enough cash in your bank account? This is a common question in both business and personal finance. My guess is you’re taking one of the following approaches: Why should your cash balance matter to you? What about some strategies for determining cash reserves? Here are 2 simple approaches…
If I were to “drop in” on your business today, could you tell me how things are going this week? Most business owners don’t have a formal tool or process for monitoring early warning signs (both good warnings and bad warnings). These “tools” go by many names: KPIs, scorecard, dashboard, balanced scorecard, report card. Queue…
Over the weekend, I went to a trade show and met a number of very interesting people working on very interesting projects. One conversation went down the rabbit hole of the benefits (tangible and intangible) of networking. We agreed it best to approach networking from the standpoint of curiosity and learning (what’s your story? what…
When it comes to managing a business, there are typically 2 schools of thought with staunch defenders on each side: (The latter is sometimes referred to as micromanagement.) In his recent article Founder Mode, Paul Graham (founder of startup incubator, Y Combinator) compares the hands-on management approach (Founder Mode) with the traditional delegation approach (Manager Mode)….
With Labor Day promotions behind us, it feels like a good time to talk about the financial impact from discounts, promotions, and marketing campaigns on your business. It goes something like this: These aren’t necessarily bad strategies. Remember, promotion is one of the “4 P’s of Marketing.” But we typically fail to account for them properly when…
In any business (that’s any industry, any size, any product), there are generally only 3 ways to use profits: Most finance pros refer to this mix of profit usage as capital allocation. What does capital allocation actually mean? Capital is just a fancy word for money, and it can come from a few sources, but mostly cash generation…
What makes a great business? When I worked in the investment industry studying and investing in public companies, I was often searching for “great businesses” and over my career developed a short list of characteristics that (I think) make a company great. Why should this matter to you? These traits are in no particular order,…