Dollars, Dollars, Dollars - It truly is a Prudent (Business enterprise) Man's Globe

 

On the Monday I located myself in the Post Place of work handing in excess of a very large cheque to shell out my once-a-year tax monthly bill. Shelling out out so substantially income would generally be adequate to make a grown male (me) cry, but to be genuine I had a smile on my face. Why? Very simple truly - I understood that I might been conserving the revenue from my earnings for the duration of the calendar year and so I had loads of funds in my company account to protect the payment.
On the Tuesday I had a meeting with a client who owns a massive kitchen and toilet provides firm.
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As we discussed the economic climate, he was very upbeat. Not only did his firm have ample money in the bank to carry them via at minimum the following 12 months, but also a neighborhood bed room furniture firm experienced recently gone out of business, so he experienced taken on some of their workers and experienced expanded into supplying bed room home furniture.
Later on in the 7 days, I watched a Tv set programme speaking about the result of the credit history crunch on the car market. The huge message was that, if you are in the sector for a new automobile, there has never ever been a superior time to head to the showrooms. Searching for that aspiration Lexus? You can almost ask them to pay out you to take it off your arms! In fact one particular auto enterprise (Mazda) is even offering a 'buy-just one-get-a single-free' offer on new models!
So what do these 3 unrelated incidents train us about small business? For me, two messages stand out really clearly:

Lesson 1:

To start with, a return 1 of my favorite themes: I really like the aged adage, "income are vainness, income is sanity, hard cash is fact". It will not issue how quite a few income a business tends to make if it's not producing a financial gain on individuals revenue. And that revenue demands to be turned into money in the financial institution - more than enough to always be equipped to pay out the expenses when they come up (like my tax bill). Keeping a good cashflow is essential for extensive-term business enterprise good results and is even much more vital in these tricky periods. As my customer company demonstrated, if you have sufficient dollars available, you have a fantastic security blanket in location.

This is a standard truism - when Joseph interpreted Pharaoh's dream and encouraged him to keep grain in the course of the seven several years of loads, in readiness for the seven yrs of famine, he was educating a essential business lesson. The trouble is that a lot of organizations (big and modest) fall short to understand this lesson, with the result that in 'times of famine' (aka credit score crunch/recession/financial downturn) they endure professional 'starvation'.

Lesson two:

The next lesson is even far more pertinent to the economic crisis we are now encountering and it is basically that moments of crisis normally present outstanding chances - in particular for individuals who have heeded Lesson 1!