Cash-Flow,Positive,Business,Yo business, insurance A Cash-Flow Positive Business of Your Own Must Do #3
Small offices have unique needs, and thatincludes document shredding. Designed with the smaller business inmind, the Dahle 20314 is a cross-cut shredder that offers Level 3security and brings you into compliance with federal regulations. The As we all know to live in this world we have to perform some activity by which we can earn money. There are many activities by which we can earn money and meet the standards to live in this society. And from one of them is franchise. Franc
Wevediscussed the importance of using other peoples money to invest in yourcompany and keeping your fixed costs as low as possible. Now, here is the third thing you must do tohave a cash-flow positive business. 3. Keep the ratio of direct costs toindirect costs very high.In businessyou have many, many functions. A lot of you work at companies. It could be theaccounting department, the human resources department, or the sales andmarketing department. There aremany functions in a business, but only some of those functions are directlyrelated to your sales. Is themanufacturing department directly related to sales? Yes; they are actuallyproducing the thing. If you havea seminar business, is the person who teaches the course an indirect or adirect cost? That is a direct cost of getting and delivering the sale. Are thesales people for it a direct cost or an indirect cost? They are a direct cost. Everythingelse is indirect. So the onlypeople you want to be paying are the people doing the doing or doing theselling. You wanteveryone either doing the doing or doing the selling! You want tokeep all the other costs infinitesimally small. If you dothat, do you think your company will make money? Think about it for a moment.All of your costs are going to selling and delivering. It is really hard tolose money. If you haveone salesperson and one delivery person and you have three people in accountingand four people in HR taking care of the two people that are doing the work, itwont work. I wish I were joking, but I have seen companies just like that. Ihave seen a 20-person company that had seven layers of management. I was calledin as a consultant for this company that had 20 employees and was saying Whoat the bottom of the pyramid is holding this thing up? It didnt take much totip it over. If all of the people at the bottom are doing all the work, thenthey have the entire structure sitting on top of them. It is avery simple principle.
Cash-Flow,Positive,Business,Yo