Posts Tagged ‘cash flow’

Cash Management: Why the Recovery Might Be Your Toughest Challenge

Thursday, August 19th, 2010 by Dave Dudon

Many businesses are worried about surviving the recession, but they should be just as concerned about surviving the recovery. 

To understand why, think about a deep sea diver.  No matter how skilled or experienced he is, he is limited by the amount of air in his tank.  He can’t create more air once he goes under, so he must reserve enough air for his return to the surface or he won’t be diving again.

For businesses, cash is like the diver’s air.  As sales decline and revenue drops, you may have enough cash reserves to survive on the “bottom” for awhile, but when it’s time to return to the top, will you have enough air to make it? 

Be smart about your cash usage.  Be proactive.  Be innovative.  If you don’t, the return of the “good times” may be your toughest times yet.


Nothing New

Wednesday, July 21st, 2010 by Troy Schrock

During the 1930s, 1940s, and early 1950s, my grandpa and his brother built and exited a number of different business ventures.  They began by helping their dad with his cattle business and launched into a full-scale dairy operation.  (I have a photo circa 1930s of a delivery van with “Schrock Dairy” and “Natural Milk & Cream” written in fancy lettering across the sides and back.)  From there, they launched a full-scale apple orchard business.  Then, with the full-gut commitment unique to entrepreneurs, they tore down all of their orchards and started a hybrid seed corn growing business.  They later added a fertilizer (anhydrous ammonia) business with multiple plants and distribution facilities across Illinois, Indiana, and Ohio.  This business was eventually sold to Standard Oil of Indiana.  (I guess anhydrous ammonia was the rage those days.)

Today, we are more than a half-century removed from these entrepreneurs, so naturally, we have different business concerns than they did, right?  My dad was recently reading through their correspondence and found two consistent themes:

  1. Get the right people in the right positions.
  2. Cash flow!   Cash, Cash, Cash.  It was never far from their minds.

OK, so maybe business really isn’t much different today!  The key issues facing entrepreneurs 75 years ago are the same for entrepreneurs today, and they will still be the same 75 years from now.