Instant Profits: Making Your Business Pay

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Foreword

How many times have you heard, “Cash is king”?  Probably many times, and it’s true.

In fact, a business can survive, sometimes for a long time, perhaps years, without making a profit. But a business will be out of business very quickly – days, weeks or months at most – without positive cash flow.

So with such a big deal made about cash, does that make profit some kind of a financial step-child?  Not at all.

Perhaps the best way to compare these two essential elements of business success is by thinking of your business as a human body, which has three essential requirements to survive: oxygen, food and water.  In your business’ body, cash is the oxygen, while profit is the food and water.  Obviously, a human can live longer without food and water (profit) than you can oxygen (cash). But ultimately – and here is the key understanding – both are required for long-term success.

Profit and cash actually have a symbiotic relationship.  You can’t produce profits without cash, and the long-term accumulation of profits, in the form of retained earnings you leave in the business, can produce working capital reserves that contribute significantly to your ability to achieve positive cash flow, even during the inevitable slow period.

While managing for cash is a daily imperative for all business managers, unfortunately, far too many businesses don’t spend enough time on managing for profitability.  That’s why I’m very pleased about this book, by my friend and world-class profit expert, Steve Martin.

In this important work, Steve treats you to the key elements – in plain English – you need to understand about profit: how to think about profit, where to find it, how to manage for profitability, and of course, how to preserve the profits you make.

If I could give you one piece of advice about cash, I would say be sure to understand the impact of time on your cash by knowing the relationship between your accounts receivable days and your accounts payable days.  If I could give you one piece of advice about profit, I would tell you to absorb everything Steve Martin will tell you about it.

Good luck,

Jim Blasingame

Award-winning host of The Small Business Advocate Show
and creator of the small business knowledgebase, AskJim.biz.

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