Monday, October 5th, 2009
Many investors try to avoid these troublesome relationships by using online brokers. Online investing is promoted as fun. Chat rooms, IPOs, after-hours trading, 24-hour research: The message is: meet interesting people and make quick, easy money. The results are not any better than using a live-body broker.
Studies show switching to low-commission, online brokers leads to overconfidence. Stocks are bought and sold online in seconds. Online research takes hours if done quickly, days and weeks if done properly. Online investors skip the research and go directly to the trading page. This causes excessive trading, which quickly adds up to excess commissions, large spreads, great unhappiness, and poor results. A few investors become addicted to trading.
Investors using online brokers often turn to chat rooms to get comfort during volatile markets. Chat rooms are full of investors trying to promote their own shares. Their agenda is to get you out of your shares and into theirs at ever-higher prices. Rumors and mass hysteria are treated as fact in chat rooms. Your gullibility will hurt you.
Tags: business plans, company, economy, marketing schedule, payment plans
Posted in business publications, money spending, strategy elements | Comments Off
Friday, July 31st, 2009
Looking for ways to decrease operational costs runs hand-in-hand with looking for new and better ways to manage operations. Can the sales team cut down on the number of personal calls by making regular telephone contact instead? In addition to saving sales call time and money spent on automobile wear and tear, the new approach might give a definite market advantage by allowing staff to make more frequent contact. Done correctly, this can translate into better service at a lower cost. Then everyone benefits.
Inventory can be a cash eater if it isn’t financed. The company should pay the interest required to finance the inventory and keep its cash at hand. The company may need it. To make this clearer: In buying a car, you might have the funds to pay for it in cash, but by financing it, you keep your funds available in case you need them for some situation where it’s more difficult to borrow money than to use your cash. Of course, the company should also better control inventory quantities, to minimize its cash investment.
Tags: cutting costs, interests, payment plans, preserving cash
Posted in business patterns, cash demand, companies, funds | Comments Off
Friday, July 31st, 2009
If cash flow does become an issue, it’s obvious that the company will have to change the way it’s doing business if
it wants to survive. Does that executive plant service still come in once a week to water the ficus and all the other office flora? As a manager, you may have to cancel the service, buy a $2.98 watering can, and start doing it yourself—or maybe just get rid of the plants altogether.
That may seem a little obvious, but it’s amazing how many businesses fall into comfortable patterns during good times and don’t see them as unnecessary frills when cash becomes tight.
Tags: cash dynamics, cutting costs, payment plans, preserving cash
Posted in business patterns, cash demand, customer demand, developers, online bank | Comments Off
Friday, July 31st, 2009
Beware of rapid growth. Many J companies have grown so fast that demand has outstripped their ability to pay for increasing inventory or improved services to meet the demand. Remember that demand is not cash. A company should not borrow too much on the expectation that, when it meets demand, it can repay the loans.
Preserving cash flow is one thing and improving market strategies is another. But sometimes the two can work hand-in-hand for even greater benefit. All it requires is a little better management thinking and a clear understanding of the challenges you face.
Tags: cash dynamics, contingency, payment plans, preserving cash
Posted in cash demand, companies, merchandise, online bank, taxes | Comments Off
Friday, July 31st, 2009
When planning cash flow needs for a new business, managers should take their best guess and then double it. Then they should plan to spend three times as long moving into a profitable mode. That way they’re less likely to be disappointed. The point: It’s sad but true that being a pessimist is probably more prudent than being an optimist when predicting costs and length of time to profitability.
Companies should borrow or set up payment plans with suppliers to pay for all of inventory—or at least part of it—and then actually pay for the inventory using funds received from customers paying their bills (otherwise known as paid off accounts receivable).
Tags: cash crunch, cash dynamics, contingency, payment plans
Posted in companies, management, merchandise, money spending, negotiationg | Comments Off