In 1994, while living in Dallas, Texas, I went on a mission to figure out why so many small businesses continually struggle with financial problems no matter what they try, or go bankrupt and fail when they offer excellent products and give excellent customer service.
I have known for decades that small and medium sized businesses are the real backbone of any economy, be it a city’s economy, a state’s economy or a country’s economy. It isn’t the mega corporations that truly sustain the economy and create jobs for the multi-millions of citizens in the volume that is needed to keep the economy going and growing.
Sure, big governments’ onerous regulations keep the boot on the financial neck of all businesses, and the bigger the government gets, and the more debt the government takes on, the bigger and heavier that “regulations boot” grows.
But was there something that the business owners and their management teams were missing? A secret sauce that would help them put, and keep, a firm financial foundation under their businesses and keep the company solvent so that they could weather big financial storms?
That was the answer I was determined to find, and find it I did.
The SECRET SAUCE
The secret sauce is knowing, understanding and practicing good cash flow management… it is deceptively simple and incredibly powerful… more on that in a moment.
All business owners know something about accounting, but even being an expert in accounting isn’t enough to keep a company in good financial shape. Why? Because accounting, while important and necessary [especially because we have to have the financial reports it produces to file tax returns], is only a record keeping system that tells you what happened in the past. It tells you how much income came in and when, and how much money was spent and what it was spent on.
What accounting does not and cannot tell you is how to improve the income and profitability and how to put a firm financial foundation under your company, how to dig it out of debt quickly and efficiently, and how to spend the income in a manner that is in the best interests of the company, not in the best interests of the company’s suppliers or the IRS.
Accounting DOES NOT offer a roadmap and guideposts to let you know what actions to take with the cash flow to improve the company’s financial condition and make it rock-solid financially safe.
Cash flow management DOES do that for you if you understand good cash flow management practices, and practice good cash flow management religiously.
How many times have you asked yourself, or your bookkeeper, “How much money do I have in the bank? Can I pay this bill, or buy that item?” Asking that question means the financial tail is wagging the dog. That’s your bank balance [the money] controlling you, the business owner, when it should be the other way around. The business owner should be in total, and tight control of the money at all times and be able to recognize and take the right financial actions to improve the company’s financial condition in good times and bad times.
The really good news is that correct cash flow management is not rocket science, nor is it difficult to learn and practice. It does take work and discipline to keep the financial practices in so you don’t revert to your old habits; relying on your accounting to run your business for you. It doesn’t take very long to learn and it actually takes very little time each week if you have the right tools.
A couple of big “Ah Ha!” moments happened to me when I was teaching business owners in Dallas, and then California, how to manage their cash flow by sitting with them face-to-face and coaching them through the correct actions using notes and checklists I had proven worked because I used them with my own money first.
First Ah Ha Moment – I realized that there were a lot more business owners than the ones in Dallas/Ft Worth and Los Angeles, California that needed to know what I was teaching, and that I needed to reach the millions of business owners in the U.S. with what I knew and could teach them.
Second Ah Ha Moment – I realized that I needed to develop a software program that could teach the business owners exactly what to do with their cash flow on a weekly basis, and actually help them plan out what they were going to do with that cash flow without needing me there with them. After all, I do plan to retire… some day.
The second Ah Ha took me years to bring into reality. Designing, creating and developing a software program was something I knew nothing about; zero, nada, zilch. So I had a whole new field to learn. I had to find and pay expert programmers and developers to help me, AND I had to use my own cash flow management system to make enough extra money to fund the software development on a pay-for-it-as-I-accumulated-the-money program, and it is NOT cheap.
It took me 6 years from idea to software launch. But, it is very affordable for business owners to use at a small $39.95 a month subscription rate with no long-term contract necessary, and it is online so they can use it on any computer, tablet or iPad, anywhere they happen to be where they have an internet connection.
I am very proud to say that my software program is in use in businesses in 30 countries around the world as of 2016, and it has helped so many business owners get out of debt, pull themselves back from the brink of bankruptcy, and turn their companies around into financially solvent and stable entities that are a blessing to themselves and to the economy.
I am NOT the hero here
And it’s not my software that’s the hero either. It’s the business owners who made a firm decision to change the way they were managing their money and decided to religiously use my cash flow management system and to do the work necessary to take control of their financial future that are the true heroes. They have no worries about money and they sleep very well at night because of it. A tip of the hat to, and loud applause for all of them.
There was a specific reason that I named my software system “Cash Flow Mojo”… because Mojo means “Magical Powers” and indeed the system works like magic if the business owner works in it for about 30 minutes every week to do their cash flow planning and then executes the plan, and THEN records that execution in their accounting system. A small price to pay for the benefits it brings to their company.
Want to earn an MBA Degree in Cash Flow Management Know-How in 65 pages of reading?
You can do that by reading this book I wrote on it that’s available at Amazon for less than the price of lunch.
Unleash Your Cash Flow Mojo – The business Owner’s Guide To Predicting, Planning and Controlling Your Company’s Cash Flow
Want to try out the Cash Flow Mojo software system to see if it is a good fit for what you want to do financially in your business? You can do that here for less than the price of lunch too with the 30-Day trial for $9.99
You have nothing to lose and so much to gain. So why not decide to learn about this system…it just might help you achieve the financial dream you had when you went into business. The sky really is the limit… reach it by using correct cash flow management in your business.