The Metric That Matters Most

Remember all the uncertainty in 2020 with COVID and how it all turned into sunshine and roses? It was thrilling to be in the land of ecommerce growth and cheap working capital and 10x multiples on exits.

We all remember the fun times of watching Top Line revenue grow and keeping an eye on ROAS. Unfortunately, it didn't last long.

Now we're back in the land of uncertainty. Inflation, high interest rates, new rules by Amazon every time you turn around, and now tariffs. Can we go back to those simple times?

How can you get ahead of it all?

It may seem like you have to be sophisticated in every aspect of your business and be a financial wizard too. But I am going to make it really simple for you. Your main metric is cash in the bank.

No, top line revenue and ROAS are not your measures of success any more. Now you have to worry about profitability. And not the bottom line on your P&L.

I'm talking about the real profits that sit in your bank account. I'm talking about CASH! The reason being, you can be profitable on paper and run right out of cash. So, how much cash do you have? How long will that keep you afloat?

If you look at your bank accounts and notice they are getting smaller month by month, then you have a cash problem. If you need to order inventory and don't know where the down payment will come from, you have a cash problem.

Let's get ahead of those problems and understand what is happening to your cash.

Maybe you have relied on your P&L and it shows a profit. But that can be misleading because your bottom line on your P&L has to fund inventory. Your supplier most likely will want a down payment.

If there isn't cash in the bank, you are looking to fund it with loans. Maybe you're big enough to use working capital effectively, but many ecommerce businesses are using it as an oxygen mask.

Your bottom line has to pay back the loans. Again, the P&L captures your interest, but the principal is on the balance sheet. Hiding, where accountants bury the dead bodies. (Sorry - old accounting joke.)

And if you take an owners draw periodically, that hides on the balance sheet too. That bottom line suddenly is looking as thin as the ghost of profits past.

The good news is, managing cash will give you the visibility of all the past potholes and let you get back in the driver's seat of your business. It's the way to know with certainty how your business is performing.

In our Cash Accelerator Program, we build out your cash roadmap in 30 days. We help you forecast your inventory and we model your debt. We even start you down the path of real profits with a Profit First strategy.

In 30 days, you know where you stand and how to manage your business from the true measure of success, cash in the bank.

Are you ready to buckle up and build that cash? Hit reply and tell me what is causing you stress in your business right now. Let's work together to make it better.

We have two openings for the Cash Accelerator in February. Schedule your free consultation now before they're gone!

Cyndi