I often hear contractors talk about the nice profit they made on a job. I understand what they are getting at, but what they really mean is they made a nice margin on a job. Margins are not profit. Your ability to earn a consistent profit depends on understanding the difference between the two.
Every business owner wants to increase net profit, and there are two common approaches to doing that: increasing prices and cutting expenses. However, there is another way to increase profit without raising prices or slashing expenses: performance pay.
In the September/October issue, I defined EBITDA as net profit adjusted to make it more useful for business valuation. To estimate a company’s value, valuers multiply EBITDA by a number called the “multiple.” The result is the estimated value of the company.
As a business owner, you juggle multiple tasks: managing a team, handling clients, bringing in new leads and making sure projects run smoothly. Among these, one critical responsibility is often neglected: ensuring profitability. .
While there are no absolute rules, there are conventional practices for valuing a business that informed buyers and sellers generally follow. One of those is valuing a business as a multiple of its net annual profit expressed in a form called EBITDA.
Net working capital is one of the most important measures of a company’s health because it indicates the ability to pay debts on time.
When you’re on a journey, you need a starting point and a destination to be successful. In business, we use key performance indicators to map out those points and improve profitability.
Imagine pulling up to an appointment at a prospect’s home. You worked hard on the bid, but as you approach the door, your mind starts to whisper, “I can’t do this. I’ll mess it up. They won’t pay that much. I’m not qualified.”
As a coach, I’ve witnessed a lot of suffering in business. Some of it is normal and transient, but a lot is persistent.
Preventing fraud safeguards our company and employees from reputational harm and legal issues arising from vulnerable moments.
Why does having a profit not always translate to available cash? Unveil the connection between profitability and cash flow challenges, exploring the factors that can leave you questioning the absence of funds despite a profitable outcome.
The willingness to discount prices and the reluctance to raise them are based at least in part on the lack of good information.