How do you increase profits without increasing sales?

Everyone is telling you sell, sell sell! But that just means more work, and you're flat out now.  You need more work like a hole in the head.  Is what you need more profits?

You know your line of work well, work hard, and do a good job.  But somehow the profits are just not quite what you'd like them to be, not that you understand much about that side of your business.  There are many businesses like you.

It's a difficult situation.  You're the boss, the captain.  You maker the decisions about where the business goes and what it does.  But are you fully in control of the business if you don't really understand where the profits come from.

After all you probably leave all that financial stuff up to your accountant.  And you see her how often?  Business decisions usually have to be made more quickly than that.

If you are the captain of a sporting team there are a couple of key facts you have to know throughout the game if you are to make the right decisions and win the game.  And the key facts are both numbers:  what is the score and how much time is left in the game?  If you are losing, what do you have to do about it and how much time do you have left to do it?  If you are winning, how do you defend your position, and for how long?

The financial numbers in your business give you the business score, a guide as to what is happening in your business.  Just like the captain of a sporting team you have to make decisions about your business.  They may be short term, day-to-day decisions about pricing or purchasing.  They may be long term decisions about financing options, or whether to incur the cost of additional staff, or invest in new equipment.

Which ever way you need the score, the financial information, to make the best decision. Decisions made when in possession of the facts are far more likely to be the right decision than those made by gut feeling and instinct.

The problem is that the years spent learning your profession or trade haven't necessarily given you the training to understand what is happening with the finances in your business.  As one client said to me "I know our product is good, and the customers appreciate our service, but I don't understand the books, and because I don't understand, I don't feel in control!"

Why can't I just leave all this to my accountant? You can, you can give in to the temptation to either ignore it because you don't have time or it's hard, or just toss it off to your accountant for explanation.  Where does that leave you?  So she tells you about them, but you still won't understand.

And if your accountant is not in regular touch with you, by the time she notices an issue it may be too late.

To be in control and in a position to make decisions on improving profitability you don't need to be an accountant, or even a bookkeeper, but you do need to have an understanding of what your financial information is telling you.  It's not voodoo, and doesn't require an MBA.

What are the two key financial statements?

• The Balance Sheet shows your current financial position at a particular point of time i.e. the balance of what you own (your assets) and what you owe (your liabilities).

The concept of working capital is one other bit of vital information you derive from the Balance Sheet.  It is essential to good financial management and tells you how much money you have to ‘work' your business.

• The Profit & Loss Statement shows what has happened in the past, how you got to the position reflected in the Balance Sheet. Are you making money or losing money. If there is a profit leak, then from where is it coming?

Why is this important?

Knowing, and understanding the financial score is important for many reasons.  Hopefully:

• your assets are larger than your liabilities, otherwise time might be running out in the business game;
• you have sufficient working capital to pay the bills as they fall due;
• your business is making profits, and not losing money;
• your business is not leaking profits which you can't see

If you are losing money then your working capital will be going down, and the time may be coming when you can't pay your bills.  Or you may not be making as much profit as you should be, and so are struggling.

What to do if you don't understand?

For a start, don't panic.  Unless things are really bad you will have time to gain an understanding, and to make the right decisions.

Then sign up for the Financial Management Self Assessment Program. This program allows you to self-assess your progress in learning to understand your financial statement, with the option of some coaching.

You may never have the depth of knowledge you do about your profession or trade, but you certainly can get to the point where you can make an informed decision.

You will get a CD containing the complete Financial Management Program with self-assessment questions (Value $49) PLUS a complete set of notes on the content of the CD (value $17).

The Financial Management Program will help you understand:

• The difference between bookkeeping, accounting and financial management;

• The role of the Profit & Loss Statement;

• The importance of breaking sales into groups such as markets or products;

• The critical importance of Gross Profit and what it should cover;

• The difference between ‘mark-up' and ‘gross profit';

• How to calculate ‘break-even':

• The role of the Balance Sheet and its relationship to the Profit & Loss Statement;

• How to calculate how much ‘working capital' you have;

• How to analyse the Balance Sheet and the most important ratios to use, such as the Financial Risk ratios and efficiency ratios;

• The Working Capital cycle;

Bonuses - but wait, there's more!

If you are in business, you want a profit, a surplus.  And we have a surplus on offer, an optional extras, if you would like to take it up!

• A recorded teleclass on Cashflow Management (2.5 hours - Value $19). It's frustrating isn't it. Your accounts show that your business is making a profit but, you never seem to have cash to pay the bills. Where is it being tied up. Listen to this MP3 recording of our cashflow management workshop to get some of the clues.

So why can you help me?

After a career in manufacturing industry, plus a short time in retail I have spent the last 17 years helping small businesses in Darwin in the Northern Territory of Australia plug their profit leaks, improve their cash flow and increase the free time they have available.

Darwin is that place top dead centre on the map of Australia.  Aussies see it as a bit remote but we know better.  It's the nearest bit of Australia to South East Asia, the "gateway" really.  Darwin supports Australia's third major oil and gas hub, in the Timor Sea, some very large mines, a major proportion of Australia's Defence Forces, and a significant tourist industry (Crocodile Dundee country).

It's the small businesses that support these and other industries that I work with.  They're ingenious, hard working, and very good at what they do.  But like small businesses everywhere the years spent learning their profession or trade hasn't necessarily given them the training to understand what is happening with the finances in their business.

And by providing this same program in face-to-face workshops and individual workshops over many years I have been able to help them.  As a client said, I have "a calm, common sense approach to explaining how business works"

If you want to learn a little more about me, well, go to "About me".

And here's what some people who have tried the program have said:

"Easy to use, logical, well laid out"

Catherine Cover, Darwin, NT  Australia

"Quite easy to use, good to have both the hard copy (of the notes) and on-line, refreshed everything for me"

Amy Gaden, Palmerston  NT  Australia

"It has explained a lot.  I most definitely have learnt.  It has been good. As I am unable to get to workshops I have been able to fit it in when I have time."

Justin Shoubridge Alice Springs Australia

Now, would you like a Guarantee?

Here's what we can do for you. 

Two Boomerangs Guarantee

Now why do you need two boomerangs for your guarantee?  It's simple really.

First boomerang - of you feel you haven't got value out of our product then all you have to do is heft it on hand, and return it.  Just like a boomerang, wing it back to us.  You may dance on it, throw a part around it or even use it at a corroboree.  That's all right, as long as you give it a good throw so it returns to us.  And then:

Second boomerang - we get the product back, and arm back, and.... Throw...whoosh, whoosh, whirl, whirl back come your funds.  In full, right into your hand.

It's simple really.  One good boomerang returns another.

Buy Now!

	Base Program	Premium Program
Financial Management Program CD Value $89.00	√	√
Bonus1 - Copy of Workshop Notes Value $29.00	√	√
Bonus 2 - Workshop Recording - Cashflow Management Value $19.00		√
Total	$118.00	$137.00

You are the captain of the team.  Know the score in the business game and make the winning decisions to increase profitability, without having to sell more.

Adam Gordon

Profits Leak Detective

Is there something bugging about this page, something that is just not right, or that (horror) I spelt incorrectly?  If so, let me know through this link .  And thank you!