by Debra Robinson | Feb 6, 2023 | Blog, Cash Flow, Cash Flow Confidence, Follow the Money
Happy New Year!
In 2023, it is time to discover the pattern of cash flow that works for your business. A little change could make a big difference for financial success.
Moving money through the wrong channels at the wrong times can drastically bottleneck cash reserves. Partnering with a cash flow expert is the quickest step to excel your financial knowledge within your business.
The #1 action that cash flow experts suggest is to generate a financial forecast to create the road map of spending.
The immediate ROI is knowledge of the dollar amount needed for cash reserves.
Having looked at many business financials in the last year, I have observed business owners tensions grow as inflation rises costs. However, with the ability to be disciplined to a cash flow plan, owners can pivot away from cutting their biggest expense; salaries and benefits, .
Closing the books on 2022; the 3 biggest financial problems I am seeing are:
1. Draining Bank Accounts: Owners are spending more than they are bringing in cash collections.
2. Accounts Receivables are becoming more challenging: Struggles with cash flow results in reduced monthly revenue.
3. Rising costs and less revenue: Inflation has tightened bank accounts leaving less extra money for reserves.
I welcome the opportunity to help dental practices and small business owners to discover their pattern of cash flow to eliminate money struggles for 2023.
Not sure where to start? Sign up for a SWOT package that will deliver: the good, the bad, and proactive strategies you can implement right away to become more empowered in managing your financial arena in 2023.
EASY AS SWOT
Which way is your money flowing? Gain the level of empowerment that only comes from a SWOT analysis.
SWOT Cash Flow Forecasting Package: One Time analysis of owners current financials. Debra will create a cash flow forecast giving owners an 8 month view into the future of what their cash on hand balances are likely to be based on their current financial story.
- Delivery of an eight-month cash flow forecast that is directly tied to your current financial story.
- Guidance on what your minimum cash on hand balances need to be to sustain your business in the months ahead.
- A one-time analysis to help you understand where you are today and identify proactive strategies that can help you make smart short term decisions.
- One-on-one consultation to understand your cash flow forecast, which will model a likely outcome for 8 months into the future
by Debra Robinson | Jun 27, 2022 | Blog, Cash Flow, Dirty Little Secrets about Cash Flow
Did you take on more debt by signing up for an EIDL loan? Have you been funded with 1, 2 or even 3 loans in the last 2 years? If so, please continue to read this very important message that I want to convey that you might not realize what you signed up for when you took on more debt from the SBA.
I worked with one of my clients last week to learn about how the payback schedules are going to be kicking in. Most of my clients started receiving EIDL funds in 2020 and then some have taken 1 or 2 more loans. Each time, the government is deferring when your FIRST payment will be due.
SBA Loan – Gift or Burden?
How nice of the SBA to let you know that your loan(s) payments are being deferred for 12 or 24 months from your initial funding. Here’s the kicker…… your loans have been accruing interest from day 1 of receiving those funds. I learned that my client has accrued $14,500+ of interest on approximately $650K loan payoff. I also learned that until the accrued interest is paid off, we won’t touch the principal balance of the loan. Client’s interest is charged at $65.47/day until she is current. Oh, by the way, her first payment is not due until May of 2023 because the govt will defer another 12 months from her last funding. How nice of the SBA, or not???? Who is making money off your debt? Is it a gift or is it a burden?
Steps to Find Your Accrued Interest
Think about that for a minute……If you have not looked into your EIDL loan and are just sitting back waiting for that deferred payment schedule to kick in; I would like to strongly encourage you to find out what the accrued interest amount is sitting on your account. Here are a few steps you can follow:
- Find the last email/letter from the SBA that is for the loan. This will be your original loan document or the last AMENDED notice for the loan.
- You can call the 800 number on that letter for help. What I learned walking through this process with my client is we went to this website: Capital Access Financial System (sba.gov).
- You will need to ENROLL by clicking the NOT ENROLLED link.
- You can create your login information. (This is a different site than where you originally signed up for the loan.)
- It’s very easy. But, again, if you need help, call the 800 number on the loan document that you have received.
- Once you get logged in, it will tell you what the total balance is including the accrued interest amount. This is what needs to be paid before you will start hitting the principal amount.
- You will also see when your first payment will be due.
Dirty Little Secret
From my seat in the sandbox as a CASH FLOW expert, it’s important to create debt servicing strategies in line with how your cash flow can support them. Understanding how to manage cash flow takes more than just reading your Profit and Loss. You MUST understand the Balance Sheet that is tracking all your debt. How much you are posting to the principal portion of the loans are posting here. This money going out has NOTHING to do with your Net Profit/Loss.
Proposed Solution
I would welcome the opportunity to help you create those debt servicing strategies from a proactive perspective; not reactive. We are continuing to offer our SWOT Package to help you know where you are currently with your cash flow. The good, the bad and the ugly. Here is a snapshot of what this package can offer: SWOT Packages | Get Total Cash Clarity | Centennial Revenue Mgmt (centennialrevenuemanagement.com).
Don’t wait any longer to be proactive in managing the debt in your business/practice. Cash flow is the lifeblood of all businesses. Just because you may have more money in your bank account(s) than ever before, does not equate to good cash flow. I know all the “Dirty Little Secrets About Cash Flow” in a business. Let me bubble up your secrets to help you learn how to have more money at the end of your month!
by Debra Robinson | Nov 4, 2021 | Blog, Cash Flow, Cash Flow Confidence
Trick or SWOT? Treating your Finances…. To Outside Eyes!
Don’t be tricked by your numbers. Understanding cash flow in your business should not be frightful! Don’t play it safe going into the end of the year and not know what ghosts and goblins are interfering in maximizing your net profits and optimizing your cash flow.
Do you know the answers to these scary questions?
- Have you figured out if you are spending more money each month than you are bringing in on a cash collection basis?
- Do you know how to read your Balance Sheet that has lots of dirty little secrets?
- Do you know what your monthly breakeven revenue amount needs to be so you don’t run out of money?
- Do you know what your monthly cash reserves amount needs to be so you don’t have to juggle payroll and vendor bills?
Now more than ever, it is important to keep yourself financially educated to have a healthy business in 2021. Achieving cash flow wellbeing takes a team of trusted advisors. If you’re wrapped in wonder of it what would be like to step into November with a full awareness and presence in your financial arena, it is time to treat your business to a cash flow analysis.
SWOT Package Special 25% OFF through November. Become empowered by knowing what your cash on hand will look like for the next 8 months and schedule TODAY! Click to find more information on a SWOT analysis (strengths, weaknesses, opportunities and threats). As an expert of cash, I bring outside eyes to your financial arena. I will do a deep dive into your financials, create a working forecast model, and will deliver it to you in a 2 hour consultation. If you need support with collaborating with your CPA, I welcome the opportunity to help.
Find confidence and comfort in the financial health of your business. For the month of November, we are offering a cash flow package to help educate you on the movement of money in your business. Schedule your complimentary consultation today by calling (303) 835-7992.
by Debra Robinson | Oct 5, 2021 | Blog, Blog, Cash Flow, Cash Flow Confidence
Centennial Revenue Management offers more than consulting on cash flow; it is the GO-TO for all money management advise for the business community.
Debra is passionate about helping business owners and their teams to better understand their numbers and how to use that knowledge to grow and prosper. As such, the team at CRM provides ongoing cash flow and revenue management insights, tips and tools to help you build your financial muscle.
Using her professional background and current experiences mentoring business owners, Debra shares ways she has helped her clients from around the country with quick how-to’s on following the money to improve cash flow.
Are You Ready to Gain Control?
Start the road to financial freedom and cash flow confidence using Debra’s guide to get your business on track. Join the conversation and sign up for newsletters filled with informative tips and ways to achieve the “Dirty Little Secrets of Cash Flow”.
Gain confidence with a 5-Minute Read. Update your cash flow knowledge in a library full of monthly blogs from Debra’s resourcesful Knowledge Bank. Such blogs discuss:
How Much Cash on Hand is Enough? Cash reserves/cash on hand are the amounts of cash accessible to a business once outstanding balances have been paid. It’s an important metric to measure and determine what amount is enough for emergencies or dips in business. How much you need on hand? Read More…
The Bad Money Habits You Need to Break – I’ve seen those bad habits broken with big payoffs. What follows is a selection of some of the most common bad habits I’ve encountered during my time as a cash flow specialist, as well as how to address them. Read More…
The Role of your Bookkeeper – Most business owners think of their CPA as a go to expert for financial reporting, when in fact they should be going to their bookkeeper – The keeper of the cash flow. Read More…
Where is your Company positioned in the Cash Flow Arena? It is not uncommon for a company to show a net profit on their income statement and still find that they are having shortfalls of cash each month. Why is that? The art of managing cash flow is to look 90 to 120 days into the future. My cash flow modeling methodology forecasts 8 months into the future to predict a likely outcome. Full Article…
Centennial Revenue Management works with small business owners across industries whose needs extend beyond the basics of revenue management into total control and fiscal health.
We offer a range of cash flow consulting services such as cash flow management and forecasting as well as outsourced CFO services in Denver, CO and virtually across the country. Let us show you how to make more confident, lasting financial decisions for your company and grow a more financially healthy business. Interested in working with Debra? Click to find the right financial package for your business!
SPECIAL EVENT – Light the Night Walk
On September 23, 2021 – The Leukemia & Lymphoma Society’s Light The Night was held in Washington Park, Denver, CO. Debra Robinson has been a part of the walk since the beginning over ten years ago. She supports the memory and legend of her sister who lost her battle to cancer, but also was a pioneer of the Rocky Mountain LLS chapter. See more about LLS and how you can get involved by bringing light to the darkness of cancer. Click to learn more about the many ways to Get Involved or Help Debra’s Light the Night Fundraiser LLS Goal – Please make a Donation.
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Centennial Revenue Management is here to help by creating proactive strategies, identify, and transform money habits to ensure you won’t run out of your money.
Contact Debra today at drobinson@centennialrevenuemanagement.com
or at 303-835-7992.
by Debra Robinson | Nov 2, 2020 | Cash Flow, Cash Flow Confidence
Are you ready with your 2021 projected tax liabilities?
Do you know what your projected tax liabilities will be for 2021? Now is the time to be proactive with your CPA and request a tax review for 2021.
As we go into the fourth quarter, it is more important than ever to pay attention to your bottom line and cash flow. Optimizing cash flow takes implementing proactive strategies. Oftentimes, a CPA working independently is not proactive about helping you plan for cash requirements for taxes that will be owed in April of next year.
Concerned about your business as tax season sneaks up on us?
As a Cash Flow Specialist / CFO, I am committed to helping business owners understand their financials from a CEO’s perspective, different from your CPA’s.
Think about it this way; your CPA is focused on reducing your Net Profit to help you pay less in taxes. From a cash flow perspective, you need to focus on increasing your Net Profits that will result in better cash flow. Working together with these two subject matter experts, can help you to maximize Net Profits, optimize cash flow AND get more money into your pockets!
You can now plan for how much cash reserves you need to set aside for April of 2022.
You can also create proactive strategies to offset some of those taxes owed before the opportunity disappears by December 31st.
Now more than ever, it is important to keep yourself financially educated to have a healthy business in 2022. The PPP loan could be considered a great “cash flow” gift. Do not squander it by not looking into the future and understanding what lies ahead as your business continues to find its new normal. Achieving cash flow wellbeing takes a team of trusted advisors.
To help you on this journey, and back by popular demand, I am offering my SWOT (Strengths, Weaknesses, Opportunities, Threats) Cash Flow Forecasting Package discounted to $1,500 to help business owners continue to pivot and navigate during these unprecedented times. This is a one time analysis of your current financials.
I will deliver an eight-month cash flow forecast
I will deliver an eight-month cash flow forecast that is directly tied to your financial story in order to educate you on your minimum cash on hand balance needed to sustain your business in the months ahead. I will do a deep dive into your financials, create a working forecast model, and will deliver it to you in a 2 hour consultation. This process will identify three very important numbers:
- What your sales revenue break even number is.
- What your monthly outlay of cash is including debt servicing, and distributions.
- What your monthly cash on hand balance is and will it sustain you 8 months from now.
If you need support with collaborating with your CPA, I welcome the opportunity to help. Find confidence and comfort in the financial health of your business. Schedule your complimentary consultation today by calling (303) 835-7992.
by Debra Robinson | Aug 20, 2020 | Blog, Blog, Cash Flow, Cash Flow Confidence, Follow the Money, In The News
Understanding how to manage cash flow takes more than just reading a profit and loss.
It is not uncommon for a company to show a net profit on their income statement and still find that they are having shortfalls of cash each month. Why is that? Where did the money go if it is not in the owner’s bank account?
Many business owners now have a lot of money in their bank accounts due to the PPP Loans, EIDL SBA money and / or grant money that has been a lifeline. I will also speculate that most businesses will get their PPP loans forgiven and that will be a great cash flow gift. But will it be enough to sustain your business into next year?
Cash flow is the lifeblood of any company. Just because you may have more money in your bank account than ever before, does not equate to good cash flow. If you have experienced cash flow issues, or you want to make sure they are not lurking around the corner, today is a great day to begin building this financial muscle.
Start with answering these questions:
- What is your cash on hand balance from last month?
- What are your average cash revenues (not accrual revenues), monthly?
- What is your average outlay of cash, not total expenses each month?
- What should my monthly cash reserves amount be to not run out of money?
- Were you having a cash flow problem/challenge before COVID?
Having trouble with answering any or all these questions?
Here is a Hint: It will take more than looking at your Profit and Loss statement to get the answers. You will need to understand your Balance Sheet to help give you the answers. Learn more about following the money to your Balance Sheet.
Let me help break this down for you:
- Your Cash on Hand Balance: This is one of the “key numbers” in the cash flow equation. The ending / beginning cash balance for a month will come from your Balance Sheet (not from your online banking account). This is the starting point for knowing how much money you will have in the current month to work with in your cash flow equation.
Example: Say we are assessing cash flow for August. You will need to look at the Balance Sheet ending July 31st, the month prior to get the total amount of all your bank account balances. This will equal the beginning cash balance for August. Make note, this will include all outstanding checks that are in play but have not hit your bank account.
- Your Average Cash Revenues: This is the second “key number” in the cash flow equation. Sticking with #1 scenario, that we are working on projecting cash flow for August; what are your projected revenues that you are planning for that will clear your bank account by August 31st? This means following the money into your bank account; not what you booked but have not collected. I like to use an average of the last 4 months of revenues to start my projection in helping me to forecast revenues.
Note: This number is going to be tied to your accounting system; what your bookkeeper has closed the previous months on your Profit and Loss and showed as income.
- Your Average Outlay of Cash: This is the third “key number” in the cash flow equation. This is where the Balance Sheet comes into play. Outlay of cash is different than total expenses. Total expenses come from the Profit and Loss. You are looking at Revenues – Expenses = Net Profit. Outlay of cash is more than that. It includes the cash that is posting to your Balance Sheet each month such as debt servicing, asset purchases, shareholder dividends/distributions to name a few. If you have a loan, the principal payment is posted to the Balance Sheet (the interest is posted to the P&L). Do I have your attention?
Example: To calculate total outlay of cash, take your total expenses you are budgeting for August + loan principal amounts + shareholder distributions = Total Cash Outlay.
- Your Monthly Cash Reserves: This “key number” is different for every business. You need to educate yourself on what will work best to help OPTIMIZE cash flow.
Example: Should this number be 3 x your monthly payroll expense? Or it could be 1 x your monthly cash outlay. What is going to help you sleep like a baby at night knowing that you will not run out of money? That is what this amount needs to be on a monthly basis.
- Let us put it all together for our monthly cash flow projection. For this example, I am going to stipulate that the beginning cash balance includes PPP funding of $80,000. (Prior to COVID, the beginning cash balance might have been as low as $45,000):
Beginning Cash Balance: $122,562
Cash Revenues Projected: + $110,000
Subtotal of Cash for August: $232,562
Average Outlay of Cash: – $125,000
Projected Ending Cash: $107,562
This is just for one month, the current month. You can see the importance of adding debt servicing and distributions to the outlay of cash. This number is higher than the revenue number. What if your revenues come in short and your outlay is the same? It is not uncommon for business owners to spend the money as fast as it comes in. How will you handle additional expenses (i.e. quarterly tax estimates, payroll bonuses, etc.) that are in addition to the monthly budget? You will inevitably start to chip away at your cash reserves
Before COVID, were you having a Cash Flow Problem?
If the answer is yes, then it is important to change some of your money habits that contributed to the cash flow shortage. Were you “winging it” with your financials? Did you have an Accounts Payable process in place to control the outflow of money? Did you have a debt strategy? Or if you wanted it, you bought it and accrued credit card debt or maxed out a line of credit?
Now that you have received funding, if you do not change some of those money habits, you are likely to re-create a cash flow shortage. It may not happen for 6 – 12 months as you whittle away your stash of cash. In my experience, it is likely to happen!
Managing cash flow is not about the next 30 or even 60 days. That money is already in play! You have already committed to payroll, vendor bills, and you may or may not have control of your revenues due to the Pandemic. The art of managing cash flow is to look 90 to 120 days into the future. My cash flow modeling methodology forecasts 8 months into the future to predict a likely outcome.
Find confidence and comfort in your business’s cash flow arena. Schedule your complimentary consultation by calling 303-835-7992.
