HOW CASH IS KING

My husband and I are business partners with my son, Bryan.  He purchased a franchise, in October 2007 and started the business from the ground up.

The first couple of years were financially and emotionally tough.  This was during the downturn of the economy and my son Ken, (Bryan's brother) passed away. 

The business opened in February 2008 with enough cash to operate for the first 8 months, or so we thought with the projections we created.  Revenue was not pouring in as we had projected.  With revenue not supporting the business expenses, Bryan had to stop taking a pay check in June 2008.

The challenge - growing a business to be cash flow positive.  2009 sales were growing at a snails pace and rent was increasing 3%, beginning March 1st.  OUCH!

Bryan trimmed expenses down to the bare minimum.  For this franchise business, there were not very many expenses.  Yet the rent was running at about 45%.  YOWZA!!  That was the only expense left to trim down.

In February 2009, we went to our landlord (at the time, that's another story on a different day) and asked for a reduction in rent. 

YES, you ask, if you don't ask, you don't get.

He said "No", "however you can pay us half rent, and then pay us back with interest at the second half of the year."  We explained that Bryan stopped paying himself in May of 2008 and we needed his help.  The landlord explained times were tough for them as well.  That was the best they could do at the time.  We said, OK, we will make it work, sales needed to grow.

Sales were growing, yet not fast enough to pay the increased rent and salary for the owner.

When July rolled around, the business started paying back the landlord in increments of $1,000 a month, or more when the cash was there.  However, when cash was still tight, my business was able to provide a loan when bills needed to be paid.  I'm not talking much here.  $1,000 here or there. 

In November 2009 when the property taxes were due, there was enough left over at the end of the month to pay the taxes. Here comes December 2009 , at the home stretch of paying back the landlord.  We were not quite there, so one more time we provided a small loan to pay off the balance to the landlord.  I sent him a letter explaining the business was not in a financial position to pay the balance of the interest, yet the principal was paid off.  Whewwww. What a relief. It felt good to ahve that behind us.

We went back to the landlord again in January 2010 requesting a reduction of rent, he conceded and lowered the rent to a very reasonable amount.  From then on the business has been carrying itself with Bryan receiving a pay check again.

In 2011 the business began paying back the loans my business provided.

So last night, Bryan and I sat down to review January's cash #'s to balance the cash account, compare sales from the previous year and see what was left over to pay down the business credit card.  Once we confirmed the cash ending balance, Bryan took a HUGE sigh of relief and said, - let' put $1k in savings, pay down the credit card by $2k and leave the balance in the account for February.

What are the benefits for managing cash daily; peace of mind, the facts jack, (knowledge) the ability to know what is needed to pay down your business credit card or vendors and place money in savings.

Here's how to get started, track cash daily with the 12 month check register tool, and cash management map.  Enter in deposits daily, NO slacking, and transactions daily.  Once you build rhythm and see common recurring monthly charges, such as rent, utilities, loan payment(s), commisions and payroll, make it easy for yourself and copy over to the next month.

What will you learn about your cash needs for your business?

Was this tip helpful?  Leave your questions below or e-mail me directly at d.rosenfelt@cfomadeeasy.com

Warmly -

Debbie Rosenfelt

Chief Heart Officer

The ABC's of the Heart of Your Business Finances

Let's keep this easy. 
What do you need to get started on the heart of your business finances?

Awareness - Make a decision to consciously learn and understand the heart of your finances.

Build Confidence - Create new daily habits to embrace the heart of your finances. 

Clarity - When we are clear about what we want we can create a plan to manifest our financial goals for our business. When we have a good plan there is no way to fail.

What do you need to get started?

Debbie Rosenfelt
Chief Heart Officer

Compassionate support that transforms financial frustration into financial power.

Vulnerability . . . .HELP isn't a four-letter word

"When we were children, we used to think that when we were grown up we would no longer be vulnerable.  But to grow up is to accept vulnerability. . . . .To be alive is to be vulnerable. Madeline L'Engle

When I read this over the weekend, I thought of us, you and me and the topic around finances, the heart of our business.

There is an illusion of vulnerability when asking for help around finances.  Even when we admit "I don't know how to ...... (insert here) or I don't know where to start . . . . (insert that here)

Somewhere along our journey of life we were taught vulnerability is a weakness.  So then there is this illusion of "I have to protect" . . . . my ego, my heart . . . (insert what needs to be protected here).

It is a mistake to think that vulnerability is a weakness.  Being vulnerable means being open and receptive.  And to remain open to our journey of life with our business requires strength and conscious action.  Openness and receptivity invites what shows up in our lives to flow.

Have you ever noticed, what you resist, persists?

And when you resist emotions of frustration, irritation, and disappointment, the feeling of helplessness appears.  I read in the January 7th, 2012 Science of the Mind daily guide, "Emotions were designed to emote, as an outward expression of your soul's feelings for the human experience. They allow you to experience life in an intimate and personal way."

Hear this . . .There is no right or wrong, good or bad emotion.

When we allow our emotions and vulnerability to flow, we are allowing life to flow and open up to be with what is.

How does this relate to finances, the heart of your business?

There is vulnerability when we don't know how our business is performing.  Tools or key performance indicators (KPI's) that are used to measure performance with business finances are, Revenue , how much $$ in sales is my business bringing in, expenses, how much $$ is my business spending, and profit/loss, how much is my business producing in earnings or losing?

A few other measurements -  how much in cash do I have in my accounts?  Are my bank account balances matched to my book balances? Do I have enough cash to cover upcoming expenses?  What do I need to grow my business?

Using specific systems and tools to project a specific outcome and/or see how your business is performing is the key to the heart of your business.

So what do you need?  What is your next step?  Ask yourself, what do I want to do differently around my business finances?  What new habit do I want to create that will help me build a new muscle and confidence?

When you make a commitment to learn something new and choose to be with and do your finances differently, mountains will move for you.  I promise!

Are you ready for mountains to move?

Below is a contract for you to copy and paste, print and sign to get yourself started.  Hang it on your office wall, or by your computer, somewhere you can see it that will remind you of  the commitment you made to yourself.

Want some kickass accountability, e-mail me your commitment and we will start a conversation.

What a GREAT way to begin a new week and on a Monday!

Your Chief Heart Officer - Debbie

COMMITMENT CONTRACT

I hereby promise that I will commit my greatest effort to build a successful solid organized financial foundation for the heart of my business once and for all, by treating my business with the priority and importance it deserves, and honoring my commitments to myself to do what it takes to succeed.

 

Promised this ______ day of _________________, 20___

Signed by _____________________________________

Introducing CFO Made Easy

I am so EXCITED to introduce you to CFO Made Easy.  

In 2011 I took the leap to officially become a certified co-active coach. In August, (after I completed certification) I was asked by a fellow coach,  “are you going to combine your experience as a CFO and coach to support entrepreneurs?” I thought about it for a few weeks and said to myself, WOW, what an opportunity for me to passionately support a community of entrepreneurs.

While on my journey of coaching I worked with a coach that helped me define one of my creative, strong loving values, an “Italian family connection” . I have found throughout my life I have been surrounded with a community of people.  Be it family, co-workers, employees, customers, business colleagues and friends.

My most recent community has been with fellow coaches and leaders that live life on purpose, with passion and zest . . that are making a difference. So my community is similar to an Italian family (yes, I actually have an Italian family on my mother’s side) who speak from their heart, are passionate and love life.

Who am I you ask – Debbie Rosenfelt the founder and Chief Heart Officer of CFO Made Easy. My professional experience has been in the world of finance as a CFO or Controller for the last 28 years. 

What does CFO stand for and what do we do? 

A Chief Financial Officer and a Controller is someone who is responsible for the accounting and finances of a business.  I have primarily worked for and with CEO’s of small to medium sized privately held businesses ranging from $10 million to $35 million in revenue.

When I was hired I would go into a company, investigate, clean up and create a system with structure that would be simple and easy for the business to maintain.  Somehow I always attracted companies that did not have an organized finance and accounting system.

I always enjoyed creating something new, that was simple and easy to maintain.

So from that inquiry in August I asked myself, why not create a business based on what I am passionate about and love to do, coaching and finance . . oh yeah, and make it easy.  Easy because I see entrepreneurs and business owners struggle with the feeling of overwhelm, fear and frustration managing the heart of their business. 

The heart of a business is finances, and the key is to create a solid, organized foundation.

Recently I have heard painful stories from entrepreneurs ,  “I don’t know if I am going to have enough money to pay all my bills.”  “I don’t know where I stand with cash.”  “I don’t know if the business has a profit or loss. “ “ I’m not sure if revenue is properly recorded.”  Or “I feel overwhelmed, I don’t know how to keep track of everything, am I doing this right?"

As I would listen to their stories I thought, there must be other business owners and entrepreneurs who are having the same painful conversation.  Who do they have to talk to and ask?

Then I thought, what if I create a community and support entrepreneurs and business owners with letting go of the fear, overwhelm and relieve the feeling and thinking “am I doing my business finances “right”. And with the support, educate and share how working with your business finances can be easy.

So HELLO world of entrepreneurs and business owners . . . CFO Made Easy was sparked from an inquiry and I am igniting the idea . . NOW. . right now.

What can you do, I am going to ask you to step into entering each day with a mindset that is eager to learn, is not afraid of making mistakes and unleash your desire to grow.   Place the overwhelm, and the fear aside . . . leave being “wrong” outside the front door and give yourself permission to be with where you are, with the heart of your business and join our community and share with me how you would like support, and what you need to build a solid organized financial foundation.

So get ready for a warm, passionately supported heartfelt ride with your Chief Heart officer, Debbie Rosenfelt, and CFO Made Easy.

I look forward to connect with you and support you, with embracing the heart of your business.

Happy Passionate 2012!

Post questions, inquiries, and what you need and want for support below to connect with me.