To the blog for small and medium sized business (SME) owners.

Thursday, December 21, 2006

Business Cash Flow

It is important that business owners not only understand the meaning and relevance of cash flow to their business, but also how the owner's daily actions impact the business cash flow within their organisation.

What is cashflow?

It can be simply defined as the net amount of cash generated and used by a business during a given period. The relevance of generating positive business cash flows is SOLVENCY!

It is unusual to find anyone in private or business life who sets out to be classed as insolvent, however, a lack of financial management and control may render the business to a period of uncertainty due to a shortfall in cash to meet current and future committments.

This situation is usually found in businesses where financial planning is not considered part of the core administrative work. The business may become reactionary to difficult situations rather than pro-active in avoiding damaging events - normally driven by a lack of liquidity (cash) in the business.

Such circumstances are often brought about by many small errors on the part of the business owner over a prolonged period rather than one single major event. This may result from a lack of understanding of the financial impact on the business of even 'minor' decisions; an inability to see the "big picture".

If the business owner does not have access to a full-time financial expertise, consideration should be given to employing a part-time Finance Director to help in planning and financial management of the business.

The cost of p/t finance director help may be insignificant compared to the cost of a failed business.

Tuesday, December 19, 2006

Revealed – How a Part-Time Finance Director Can Help You To Exit Your Business

Small and medium sized business owners will be required at some time to exit their business. It would be worthy of congratulations if all such exits were planned and the owner was able to maximize the value of the business.

Unfortunately on too few occasions is this the case.


All too often insufficient time is allowed for an orderly exit, and as a consequence the business value fails to meet the business owner’s expectations.

It is often found that seeking professional advice is delayed and the exit resembles a reactionary move rather than planned.

Immediately upon the business owner taking the decision to exit professional help should be recruited, including a qualified finance professional, if one is not already employed by the business.

In many instances the cost of a full-time Finance Director ( FD ) would be beyond the resources of a business, however, in such circumstances consideration should be given to appointing a part-time finance director to help prepare for the exit.

The benefits of recruiting a part-time finance director in an exit situation include:
• Cost containment – During the period leading up to exit the p/t Finance Director would be employed only as required to meet the business needs. This may for example be one/two days per week and cost considerably less than that of a full time equivalent.
• Taking responsibility for ensuring all systems and procedures satisfy the generally accepted standards. The p/t Finance Director would ensure that no corporate governance concerns exist that may risk the disposal of the business.
• Managing the finances of the business to generate profits and positive cash flows that would be attractive to potential buyers.
• Ensuring financial and management accounts are prepared regularly and that they form the basis of the decision making process.
• Working with the business owner on strategy and offering unbiased and independent opinions in relation to the sale.
• Training staff as necessary
• Providing the financial expertise when liaising with third parties including banks, solicitors, auditors, finance providers and other professionals associated with the exit.
• Assessing the strengths, weaknesses, opportunities and threats (SWOT) of the business and of its proposed strategies. As necessary take appropriate actions to ensure a controlled quality driven culture is evident to all prospective buyers.
• Being the person responsible for the collection, preparation and assembly of all financial records and other documentation required by the interested parties.
• Preparing forecasts and projections that may be requested, thus relieving the business owner of the onerous task.

Throughout the exit negotiations the import of good financial advice cannot be underestimated. At all times it will be important for the business owner and the part time finance director to demonstrate that control of the business does exist and that good results are derived from taking good business decisions and are manifest in a good set of financial numbers.

The appointment of a part time finance director will display that the business owner regards the p/t finance director’s input as key to the financial success of the business.

To avoid the disappointment of failing to realize the expected business value on exit, the business owner should prepare well in advance. Ideally at least two years, maybe longer, should be allowed for a planned exit, and an important aspect of this process may be the recruiting of a p/t finance director to support the business owner in:
• Preparing
• Administering
• Disposing

of the business in an efficient and cost effective manner.

Monday, December 18, 2006

P/t Finance Director

Are you a small or medium sized business owner who has engaged the services of a part-time finance director?

What were/are your experiences? Did the part time FD meet your expectations and did your business benefit from the appointment?

Please let us know your views. Email DAW Consulting

Saturday, December 16, 2006

Business Exit Strategy

There are several reasons why business owners wish to exit tyheir business. These include:

- retirement
- disillusioned
- business downturn
- new business opportunity sought etc.

Hoever, do you have an exit strategy in place, with a view to maximising the value of your business? Or are you just re-acting to events?

Much help is now available to you on business exit, mergers and acquisitions - remain in control and plan to realise more value for your business.

Consider the services of a part time finance director to help you develop your exit strategy and to ensure good financial management is exercised.

Friday, December 15, 2006

Improving Business Performance, Profitability and Cash Flow

In many cases it is possibe for a small business owner to continue in business with some success, but without ever reaching the success levels of peers and contemporaries. The business plateaus and for a while no major concerns arise.

There had been no pressure to aggressively improve the business and over time trading conditions invariably deteriorate and profitability falls.

How can the downturn be arrested and business performance improve? Or better how could the situation be avoided?

All businesses should remain focused on improving business performance, profitability and cashflow.

If you need professional advice in these matters contact DAW Consulting.

Improving Business Performance

All businesses should be focused on improving business performance, profitability and cash flow.



Tuesday, December 12, 2006

Discover How To Avoid Your Business Becoming Out of Control

Does your business need a part-time Finance Director, Manager or Mentor?

Have you considered why you may be losing control of your business? Has your comfort zone been breached? Are you expected to be involved in business matters that are not understood and are alien to you? Is your business suffering from cash flow difficulties or is it expanding rapidly and causing you to lose control?

These situations are not rare. Read More.

Thursday, December 07, 2006

The Benefits of a Part Time Finance Director

Situations arise when the business owner/entrepreneur requires the help of a finance professional.

The full-time cost of such an individual may be considered prohibitive, however, the benefits of a cost effective solution can be enjoyed whilst accessing the skills of a Finance Director. Consider engaging a part time Financial Director.

Wednesday, December 06, 2006

Part time Finance Director

The small business owner may not be able to afford the services of a full time finance professional, albeit the skills possessed by such an individual may be required within the business.

A cost effective alternative approach will be to employ a part-time FD to undertake work on a specific project or to add on-going financial expertise.

This option will afford the business the opportunity to acquire the Finance Director skills commensurate with the level demanded by the business. The FD may work as an employee or more likely on a contract basis. The latter method of engaging a Finance Director would satisfy any financial constraints within the business, fix the cost for the period of the contract but allow the business to gain the necessary financial skill so often lacking in small and medium sized businesses.

DAW Consulting will help you to fill the skill gaps in your business.

If you need help in cash management, accounting, planning, governance or setting an exit strategy then contact DAW Consulting for a FREE confidential meeting.

Monday, December 04, 2006

Business Exit

The business owner may desire to exit the business. However, it is often not realised that to prepare for exit may take up to three years. Strategy for exit will need to be developed, good financial controls should be implemented and the management skills enhanced to ensure a seemless transition to the new owner.

In addition the collection, indexing and presentation of all relevant documentation and data will be necessary and DAW Consulting can work with the business owner in undertaking this work.

Wednesday, November 29, 2006


A mentor is an experienced specialist who will help the business owner through problematic times. DAW Consulting can provide the professional and expert mentor to assist the small and medium sized business owner to overcome immediate concerns and plan for improved business performance and profitability in the future.

Read "A Mentor and Your Business".

Tuesday, November 28, 2006

DAW Consulting Philosophy

What distinguishes DAW Consulting from others?

Apart from combining senior management experience with financial expertise, DAW Consulting offers clients more than just good advice. All too often the advice is appreciated by the client but the implementation of recomendations, the How To? proves to be a barrier to progress.

The business owner on occasions may need help in the 'taking action' and DAW Consulting welcomes the opportunity to involve the client in the implementation process, in order to enhance the client's knowledge and skills.

"Tell me and I will listen, show me and I will see BUT involve me and I will understand." Anon

Business Funding - How Much - Where From?

Funding will be required at various times throughout the life of a business.

The difficult choices to be made in selecting the appropriate form of funding, together with the appropriate level of funds are paramount to successfully add value the business. The type of funding may not initially appear relevant but....
Read More

Monday, November 27, 2006

DAW Consulting Mission Statement

DAW Consulting Limited values its customers and will provide superior business solutions to its clients.

This will be achieved through understanding the needs, expectations and concerns of clients through analysing, developing and delivering comprehensive solutions o­n time in a clear and logical manner.

The business success will be underpinned by the development and continued refinement of strategies that create sustainable competitive advantage. A commitment to the following core values will distinguish the business from others:

Customer Orientation
We will listen to our customers and respond to their needs.

We will provide quality in all that we do.

We will continue to gain knowledge through training in order that clients benefit from current thinking and initiatives.

We will conduct ourselves ethically. Respect the dignity of the individual and be responsible citizens.

Revamped DAW Consulting Website

Visit the new DAW Consulting website. Helping business owners to improve business performance and profitability.

Monday, October 30, 2006

Your First Accountant

We joke about them, ridicule them, try to avoid them but in most cases they are one of the first professional people we turn to upon starting a business.We try to “hit the ground running”, but in the lonely and busy life of the business owner, there is always someone or some organisation that requires information and this holds us back.

We are not always qualified to, or want to, provide endless information or fill in forms ourselves, so we naturally turn to the professional.Who is this Professional in question?


The much maligned individual is the butt of many jokes, but choose the wrong one and the joke is no longer funny.

Making the right choice is essential. All owners of start up, small and medium sized businesses can AVOID the pitfalls in choosing the wrong accountant for their business. Make the wrong choice and the consequences may be catastrophic.

How do you choose the right accountant. The areas to consider when taking your decision include:

1 Making the Right Choice – the ProcessUnderstand the processHow do you start?
2 The Services Offered - Understand what services your accountant actually offers
3 The Contract, the Fees, the WorkUnderstand the costs
4 Service Level - Agree the contact arrangements and the frequency
5 Tax Planning Meeting - Ensure you organise a tax planning meeting BEFORE you year end
6 Fee Payment Schedule - Agree the basis on which the accountant will be paid
7 Changing Circumstances - Remember circumstances change - build flexibility into your agreement
8 Referred Services - Your Accountant should be a good referee
9 Non Accounting Services - What does your accountant offer?
10 Testimonials - Ask for references from satisfied clients
11 A Friend or foe?

Read the whole of Your First Accountant ebook for free and refer it to your friends and collegues.

A Solution Resource for the Business Owner

A continuing problem faced by the owners and directors of small and medium sized businesses is that of finding relevant and easy to understand information to help them solve the problems encountered in business life.

Those 'problems' may be of the enjoyable kind. A growing, profitable and cash rich organisation that is expanding further. Or, as perhaps is more common, a not so comfortable environment may exist of declining sales, low or non-existent profits and a shortage of cash.

In either case it may not always be possible (perhaps economic constraints do exist) or necessary to engage professionals to seek advice on issues that may arise. However, for the small and medium sized business owner the process of taking decisons on matters outside their area of experise may be daunting.

Check out SME Business Solutions for help in solving your business problems.

Solutions for Small Medium Sized Business

Small medium sized business owners seek help in many areas. Business development, business planning, raising finance, cash management, merger, acquisition and human resource are key areas to be addressed.

To achieve success company strategy, including sales strategy, marketing strategy and pricing strategy will be determined as well as; linking these with the plans for accounting, finance, manufacturing, quality and; human resource within the business. DAW Consulting will help you develop your strategic business plan.

The small business entrepreneur may not immediately realise three factors that determine success. The need to focus on the business as opposed to working in it, maintain a turn key philosophy and understand the business development process. Understand more on what makes a successful business entrepreneur.

Adequate finance is critical to all business. The business owner may arrange the bank account and accounting services, however, the negotiation of business finance with a bank or finance company, the selection of appropriate accounting software, the preparation of business plans including cash flow forecasts and the development of a management information system may be beyond the skills of the small business owner. DAW Consulting can help with arranging funding for your business, learn more on the subject.

Change management will be undertaken by business as a matter of course. Technology changes, customer demands or directional changes enforced by corporate bodies will all impact on the culture of the business, resulting in new business envionments. Ensure your organisation's ability to master change is robust and employ the relevant experts.

A short term form of finance that may be beneficial to some business owners is a bridging loan. Normally available to 'bridge' the time gap between purchasing say property and receving funds from thesale of existing buildings or land.

Small medium sized businesses may consider raising cash against the business assets in other ways. Read more on other business solutions.