4 Important Financial Factors to Determine a Business’s Future Growth

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When purchasing a business, you want to first do some research about the company’s potential returns combined with its asking price. When looking at a business, you will want to ask the owner for the projected financial statements of the business in question. To understand a business’ financial health, you need to look at the key indicators: income statements, balance sheets, cash flow statements, tax returns for the past three years and footnotes. Below are 8 factors that you should focus on closely.

1)   Insufficient or Excessive inventory – If the business is product based, make sure to look into its inventory. Too much inventory can become a lost cost, as it might not be used and it’s expensive to store and insure. Excessive inventory can also mean that the business is not able to deliver their product to their customers fast enough, or customers are returning their products.

2)   Lowest possible level of inventory  – Before purchasing a company, you will want to find the lowest possible inventory that the business can hold. After this, ask the owner to reduce the stock to that number. You only want inventory that is saleable and current.

3)   Accounts receivable – Uncollected receivables can inhibit a business’s future growth and demand unforeseen bank loans. The factors that you want to pay close attention to are the business’s credit policy, accounts receivable turnover, aging of receivables, and the schedule of cash collection.

4)   Working capital – Working capital is current assets minus current liabilities. A business needs working capital to stay afloat. Another key aspect of working capital is to understand at the ratio of net sales over net working capital. This will tell you how efficiently working capital is being expended to maintain business objectives.

To read the complete list of important business financial factors, click here to read the full article form Entrepreneur.com.

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Five Tips Towards Starting Your New Business

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As the Baby Boomers retire and find that they might not be as secure in their funding as they had perhaps hoped to be, an issue starts to arise.  Many are facing forced downsizing from the familiarity and stability of their corporate positions.  Alternatively, even those who choose to retire on their own terms are finding that the pension they were promised has been severely reduced, or even that what they had planned to have isn’t enough for their monthly expenses.  The obvious solution is to take control of one’s own destiny—to become an entrepreneur and manage one’s own business.  However, to many fifty-something Baby Boomers, this proposition is relatively daunting, according to an article recently completed by The Huffington Post; these works are used to the stability of the corporate world and fear they aren’t equipped to manage the risky and fast-paced start-up game.

As a result, the article sought to provide several tips for those aging corporate workers who may be interested in starting their own business to supplement their retirement income.  Fundamentally, the first step is to stop saying it can’t be done, or that the individual can’t start and manage their own business endeavor.  In moments of insecurity, the individual need look no further than their resume—a listing of themselves, their career and their accomplishments—to know they are more than equipped in business experience to function as an entrepreneur.  Next, once the individual has bolstered their own sense of confidence, they must seek as much advice as is possible.  Ask everyone possible on what the individual is best equipped for and, in turn, listen very carefully.  Doing so could offer a number of surprising perceptions, including insights into how the individual is perceived, especially in terms of strengths and weaknesses.

Before moving forward with creating the business, the individual must also make peace with his or her perceived past disappointments and mistakes.  If the individual continues to allow these items to work as a barrier, even the best intentions are doomed to fail.  The final step before truly starting the endeavor is to set one’s own criteria; finalize the parameters of the plan of action, including what products, services or work procedures best suits the individual’s personality.  This also includes who the entrepreneur may wish to work with, and what the work culture should feel like.  Finally, it is important to remember that taking the first step in creating the business doesn’t need to be some form of a grand gesture; make a list of things that can be completed right now and, from there, choose the easiest and least intimidating and proceed full speed ahead.

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Is Ikea The End Of Design? See The Italian Counterattack At This Powerful Milan Design Exhibit

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By Jonathon Keats, Contributor Future archeologists studying the material culture of austerity need look no further than the Ikea catalogue. Even in Milan, the design capital of Europe, people under forty are likely to eat on a Tärendö table and to sleep in a Fjelsse bed – if they’re not couch-surfing on the Knislinge sofa of a temporarily-employed friend. They’ll blame it on economics – a legitimate justification for their lapsed Italian taste – yet one that’s hardly encouraging for an economy powered by good design. Is there an alternative? That’s the question posed by an important exhibition at Milan’s Triennale Design Museum. Essay by Jonathon Keats. …read more

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Staring Down The Price Of Exuberance In Venture Capital

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By Alex Konrad, Forbes Staff By Joe Horowitz, managing general partner, Jafco Ventures As a 30-year veteran of the venture capital business in Silicon Valley, the cycle of our world has become all too familiar. During times of recession the economy is stimulated with low interest rates and once they get low enough, the yield on […] …read more

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Johnson Matthey: Platinum, Supply Deficits Topping 1 Million Ounces In 2014

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By Kitco News, Contributor (Kitco News) – Platinum and palladium will both post annual supply deficits of more than 1 million ounces in 2014 largely due to a five-month strike in South Africa, but also improving auto-catalyst demand, Johnson Matthey reported Monday. The company’s research team added that palladium would have been in a deficit […] …read more

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Top 10 World Container Ports

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By Kenneth Rapoza, Contributor Seven out of 10 of the world’s largest container shipping ports are located in China. And all 10 of them are located in the emerging markets. Only one isn’t in Asia. Here are the top 10 ports as ranked by the World Shipping Council for year ending 2013. …read more

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The Globalization Of China’s Stock Market

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By Kenneth Rapoza, Contributor Just wait until the major indices like MSCI and FTSE get a hold of mainland China’s stock market. …read more

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Let’s Put An End To Restricted Giving

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By Felix Oldenburg, Contributor We like to think that private charitable giving is inherently different to, say, buying a service. This is why governments subsidize the one but not the other (tax exemptions amount to $55 billion per year in the US alone). In practice, however, donations are much more transactional than most donors admit. […] …read more

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How Old Is Too Old To Change Careers?

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By Liz Ryan, Contributor Liz, would you say there’s a certain age after which it’s impossible to change careers? Definitely. And what is that age? One hundred and seven. Come on! I’m being serious. Well, it’s a very contextual question. It depends on what you want do in your new career. Give me an example. If you want to be a […] …read more

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Student Debt vs. Car Loans

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By Lucie Lapovsky, Contributor If you listen to all the commotion, you would think that the level of college debt in the U.S. today is a crisis of epic proportion—hundreds of thousands of unfortunate young people leaving college with crushing loan debt. The facts might surprise you. According to the Project on Student Debt, only 69% […] …read more

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