The lack of money can be isolated to a limited number of causes:
- No, poor or unreal promotion
- Slow or bad service and a failure to promptly remedy it
- Improper financial management.
In order to manage money properly a finance person and company executives need to understand how each part of the organization contributes to the final products/services and income of the business and have some sense of their relative costs.
There must also be some way for Finance to regulate how money is allocated to ensure solvency and proper investment into the most profitable areas of the business and external campaigns.
If Finance was to operate without such a system and just allocated based on individual demands for funding with no regard for a return on investment, the future of the business would be quite uncertain.
While Finance can and should police the wasteful use of money, much greater sums can be lost from income potential never realized. A production area fully staffed, but only operating at half capacity will generate products at twice the cost and significantly less profit, if any at all.
Left to their own devices most businesses will try to spend more than they earn. There’s only one successful practice that consistently works to achieve a money surplus for future expansion.
There is a way to properly manage money that will lead to financial prosperity and growth. Our finance programs create the systems and practices that will help you achieve it.
Contact us for a free consultation or for more information.