THE POWER OF NETWORKING
PART 140
By Nikki Viljoen of N Viljoen Consulting CC. December 2009
So what exactly is it that makes connectors so popular in a Networking environment?
Simple really, as their name suggests they connect people with one another – people who can do great, profitable business. People who, under normal circumstances, would never even realise that they have any kind of synergy are connected in ways that they never even thought about. Connectors are able to see/think out of the box and because they understand the true essence of Networking, they are able to, not only see the connection but also facilitate it.
Connectors build huge networks around themselves, so it’s little wonder that many people would love to get to know them, to have access to their network and/or data base, if nothing else.
Connectors are people who are trusted by their networks and/or data bases and since they are well known and trusted people often do business with one another, without knowing, or on occasion, even meeting one another. You see the relationship has already been established and built by the connector.
You will always find at least one connector at a Networking event. It’s not because they need to meet yet another bookkeeper or another coach, it’s because they need to meet and have access to all the people that that bookkeeper and/or coach know in order to facilitate the connections that they need to make.
Connectors are driven to move the value that they know and trust is in their networks from one contact to the other, connecting one person to another. They understand that making these connections will also benefit them. They also understand that Networking isn’t about instant gratification but rather of adding value to their Network and over time they will reap the rewards from making these connections.
Connectors understand that it’s about finding synergy between people they have known for years and the new people that they are constantly meeting.
Connectors instinctively Network where ever they go, with everyone that they meet.
Connectors know and appreciate that their Networks are in fact a professional asset to their businesses.
Is your Network a professional asset to you? If not, perhaps it is time to make it one of the goals for you for the coming year.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Wednesday, December 02, 2009
Tuesday, December 01, 2009
BUSINESS TIPS - How To Manage Cash Flow
BUSINESS TIPS – How to Manage Cash Flow
By Nikki Viljoen – Viljoen Consulting CC July 2009 December 2009
Last week we looked at exactly what cash flow is and this week we will look at the ‘how to’ of managing cash flow. For me as usual, it’s the simplest method of ‘how to’ that I will be sharing, so please just be aware that there are many more components and levels of complexity to this subject.
It is important to understand that most of the money that you generate as an inflow should be from the sale of your product and/or service. It cannot be from investing and/finance – if this is the case you are going to be very deep in the smelly brown stuff without a shovel to dig yourself out. So sales are obviously key, irrespective of whether you are selling a product and/or a service.
It is also important to understand that the inflow and outflow of your business tells the story of how healthy or unhealthy your company is. That is one of the reasons that I believe it is so important to have the services of a really good accountant to assist you. The understanding and ‘reading’ of the story of your business can only be done by someone who is experienced in these matters and someone who will tell you where you are going wrong and guide you back onto the correct path. My someone, is Nico Labuschagne of Labuschagne & Associates and I am quite happy to share his contact details on (labuschagnassoc@lantic.net).
That said it is also very important to understand that cash flow is a ‘real time’ issue as opposed to having your books done on a monthly basis – by the time they get to the bookkeeper/accountant they are already a month or so old and are therefore a ‘reactive’ issue. You cannot wait for a whole month to then realize that you have no money to pay the bills that are coming in and are due, right now! In terms of cash flow, you have to be proactive – you have to know what is happening right now!
To create a cash flow statement, and remember that it is a living breathing document and it changes all the time, you need to take all the business inflows and subtract all the business cash outflows. This is usually done on a monthly basis but it can be done for any specific period. Obviously doing this manually is a pain in the rear end and by using an accounting package to generate financial statements and thereby producing a Cash Flow statement, would be the simplest way to do it (another reason for a Nico in my life, I don’t have to invest in expensive software accounting packages.)
When you work out your budgets, it is extremely important to use ‘cash flow projections’, because if you as a business owner, do not understand the way that your cash flow operates, you will find yourself in a cash flow crunch, where you will be waiting for funds to come in, but have operating expenses that need to be paid now.
This is particularly true if you have or run sales on account (hopefully you are then registered with the National Credit Authorities as a service provider), or alternatively have clients who pay 30 or 60 or even 90 days. You need to make provision to ensure that you have enough cash on hand to pay your bills while you wait for monies to come in.
As SMME’s, I am sure that you will agree that this is a very difficult position to be in and this is why it is vital to firstly know, what is happening from a financial prospective, in your business and secondly to understand what happens when you have cash flowing both in and out of your business.
Understanding and knowing where your money is coming in from and where your money is going out to, is key to controlling your cash flow.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
By Nikki Viljoen – Viljoen Consulting CC July 2009 December 2009
Last week we looked at exactly what cash flow is and this week we will look at the ‘how to’ of managing cash flow. For me as usual, it’s the simplest method of ‘how to’ that I will be sharing, so please just be aware that there are many more components and levels of complexity to this subject.
It is important to understand that most of the money that you generate as an inflow should be from the sale of your product and/or service. It cannot be from investing and/finance – if this is the case you are going to be very deep in the smelly brown stuff without a shovel to dig yourself out. So sales are obviously key, irrespective of whether you are selling a product and/or a service.
It is also important to understand that the inflow and outflow of your business tells the story of how healthy or unhealthy your company is. That is one of the reasons that I believe it is so important to have the services of a really good accountant to assist you. The understanding and ‘reading’ of the story of your business can only be done by someone who is experienced in these matters and someone who will tell you where you are going wrong and guide you back onto the correct path. My someone, is Nico Labuschagne of Labuschagne & Associates and I am quite happy to share his contact details on (labuschagnassoc@lantic.net).
That said it is also very important to understand that cash flow is a ‘real time’ issue as opposed to having your books done on a monthly basis – by the time they get to the bookkeeper/accountant they are already a month or so old and are therefore a ‘reactive’ issue. You cannot wait for a whole month to then realize that you have no money to pay the bills that are coming in and are due, right now! In terms of cash flow, you have to be proactive – you have to know what is happening right now!
To create a cash flow statement, and remember that it is a living breathing document and it changes all the time, you need to take all the business inflows and subtract all the business cash outflows. This is usually done on a monthly basis but it can be done for any specific period. Obviously doing this manually is a pain in the rear end and by using an accounting package to generate financial statements and thereby producing a Cash Flow statement, would be the simplest way to do it (another reason for a Nico in my life, I don’t have to invest in expensive software accounting packages.)
When you work out your budgets, it is extremely important to use ‘cash flow projections’, because if you as a business owner, do not understand the way that your cash flow operates, you will find yourself in a cash flow crunch, where you will be waiting for funds to come in, but have operating expenses that need to be paid now.
This is particularly true if you have or run sales on account (hopefully you are then registered with the National Credit Authorities as a service provider), or alternatively have clients who pay 30 or 60 or even 90 days. You need to make provision to ensure that you have enough cash on hand to pay your bills while you wait for monies to come in.
As SMME’s, I am sure that you will agree that this is a very difficult position to be in and this is why it is vital to firstly know, what is happening from a financial prospective, in your business and secondly to understand what happens when you have cash flowing both in and out of your business.
Understanding and knowing where your money is coming in from and where your money is going out to, is key to controlling your cash flow.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Monday, November 30, 2009
MOTIVATION - Don't Ever Do . . . . Nothing
MOTIVATION – Don’t Ever Do . . . . Nothing
By Nikki Viljoen of N Viljoen Consulting CC November 2009
Theodore Roosevelt said “In any moment of decision, the best thing you can do is the right thing. The worst thing that you can do is nothing.”
Wow! Ironically enough, my good friend and colleague Colleen Larsen of Women In Finance (http://www.womeninfinance.co.za) and I were discussing this very issue earlier today. Doing nothing about something never makes the problem go away – in fact it usually just makes it that much worse.
Obviously, in any given situation, it is always a good thing to do the ‘right’ thing. That’s just a given and it always makes life just that much easier.
The dilemma comes along when there is indecision or when the decision comes packaged with a huge consequence – one that we are perhaps not so willing to subject ourselves to.
Here is where the danger lies. Here is where we meet the challenge . . . or not. This is where we usually step back from the situation. Oh and don’t misunderstand me for one moment – stepping back from a situation is within itself, not a bad thing if the reason we are stepping back is to take a breath and look at what is happening. That is definitely not a bad thing. But once you have stepped back you still need to action something.
Step back, but don’t come to a full stop. Strategize, plan, engage and get going again. Do something for goodness sake!
Doing nothing is quite detrimental to yourself. Doing nothing means that nothing will happen. Doing nothing will often created a negative situation or even a vacuum and it will result in . . . nothing!
Remember that every action causes a (re) action. So get busy, get moving, get actioned!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
By Nikki Viljoen of N Viljoen Consulting CC November 2009
Theodore Roosevelt said “In any moment of decision, the best thing you can do is the right thing. The worst thing that you can do is nothing.”
Wow! Ironically enough, my good friend and colleague Colleen Larsen of Women In Finance (http://www.womeninfinance.co.za) and I were discussing this very issue earlier today. Doing nothing about something never makes the problem go away – in fact it usually just makes it that much worse.
Obviously, in any given situation, it is always a good thing to do the ‘right’ thing. That’s just a given and it always makes life just that much easier.
The dilemma comes along when there is indecision or when the decision comes packaged with a huge consequence – one that we are perhaps not so willing to subject ourselves to.
Here is where the danger lies. Here is where we meet the challenge . . . or not. This is where we usually step back from the situation. Oh and don’t misunderstand me for one moment – stepping back from a situation is within itself, not a bad thing if the reason we are stepping back is to take a breath and look at what is happening. That is definitely not a bad thing. But once you have stepped back you still need to action something.
Step back, but don’t come to a full stop. Strategize, plan, engage and get going again. Do something for goodness sake!
Doing nothing is quite detrimental to yourself. Doing nothing means that nothing will happen. Doing nothing will often created a negative situation or even a vacuum and it will result in . . . nothing!
Remember that every action causes a (re) action. So get busy, get moving, get actioned!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
MOTIVATION - Don't Ever Do . . . . Nothing
MOTIVATION – Don’t Ever Do . . . . Nothing
By Nikki Viljoen of N Viljoen Consulting CC November 2009
Theodore Roosevelt said “In any moment of decision, the best thing you can do is the right thing. The worst thing that you can do is nothing.”
Wow! Ironically enough, my good friend and colleague Colleen Larsen of Women In Finance (http://www.womeninfinance.co.za) and I were discussing this very issue earlier today. Doing nothing about something never makes the problem go away – in fact it usually just makes it that much worse.
Obviously, in any given situation, it is always a good thing to do the ‘right’ thing. That’s just a given and it always makes life just that much easier.
The dilemma comes along when there is indecision or when the decision comes packaged with a huge consequence – one that we are perhaps not so willing to subject ourselves to.
Here is where the danger lies. Here is where we meet the challenge . . . or not. This is where we usually step back from the situation. Oh and don’t misunderstand me for one moment – stepping back from a situation is within itself, not a bad thing if the reason we are stepping back is to take a breath and look at what is happening. That is definitely not a bad thing. But once you have stepped back you still need to action something.
Step back, but don’t come to a full stop. Strategize, plan, engage and get going again. Do something for goodness sake!
Doing nothing is quite detrimental to yourself. Doing nothing means that nothing will happen. Doing nothing will often created a negative situation or even a vacuum and it will result in . . . nothing!
Remember that every action causes a (re) action. So get busy, get moving, get actioned!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
By Nikki Viljoen of N Viljoen Consulting CC November 2009
Theodore Roosevelt said “In any moment of decision, the best thing you can do is the right thing. The worst thing that you can do is nothing.”
Wow! Ironically enough, my good friend and colleague Colleen Larsen of Women In Finance (http://www.womeninfinance.co.za) and I were discussing this very issue earlier today. Doing nothing about something never makes the problem go away – in fact it usually just makes it that much worse.
Obviously, in any given situation, it is always a good thing to do the ‘right’ thing. That’s just a given and it always makes life just that much easier.
The dilemma comes along when there is indecision or when the decision comes packaged with a huge consequence – one that we are perhaps not so willing to subject ourselves to.
Here is where the danger lies. Here is where we meet the challenge . . . or not. This is where we usually step back from the situation. Oh and don’t misunderstand me for one moment – stepping back from a situation is within itself, not a bad thing if the reason we are stepping back is to take a breath and look at what is happening. That is definitely not a bad thing. But once you have stepped back you still need to action something.
Step back, but don’t come to a full stop. Strategize, plan, engage and get going again. Do something for goodness sake!
Doing nothing is quite detrimental to yourself. Doing nothing means that nothing will happen. Doing nothing will often created a negative situation or even a vacuum and it will result in . . . nothing!
Remember that every action causes a (re) action. So get busy, get moving, get actioned!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Friday, November 27, 2009
HR - Preparing for Disputes - Part 2
ARTICLE 47
Preparing for Disputes – Part 2
By Nikki Viljoen of Viljoen Consulting CC November 2009
Following on from last week, today we are going to look at some of the most typical and also most important issues that can be discussed at the ‘pre-meeting’.
Some of the most typical and also important issues that are or can be dealt with are (but not limited to):
· Any means by which the dispute may be settled. Both parties would be expected to express exactly what they are wanting that would give them a sense of vindication. It is often at this point that an “out of court” settlement is reached and agreed to and once this agreement has been signed, the arbitration hearing would therefore be totally unnecessary .
· Facts that are the common cause. In some cases it is the ‘straw that breaks the camels back’ that mess the whole works up and it is easier and more beneficial to all parties to get consensus on these and to agree to the facts up front. Issues such as (but not limited to)
+ the exact date that an employee was employed
+ the exact date that the employee was dismissed
+ the exact reason for the dismissal
Here’s the thing – the more issues that can be agreed upon before the hearing, the less time (and expense) will be needed to establish the facts during the hearing.
· Facts that are in dispute. These are usually the issues that the parties cannot or will not agree on. These are issues such as (but not limited to)
+ the employees benefits
+ the employees package
+ the employees remuneration
+ whether the treatment by the employer was fair and/or unfair.
It may also include issues such as whether the employee was at the workplace on the day that the incident took place and so on.
Often at this point the parties may agree that the arbitrator will need decide if the dismissal was procedurally fair or unfair and also whether it was substantively unfair.
· Precise Relief claimed. Usually this is the discussion that takes place that highlights whether the employee wants to be re-instated or whether they want some kind of financial compensation.
It is also at this stage that the sharing and exchange of documents takes place and one ‘common’ bundle of documents can be compiled. Parties fighting about documents and their contents or lack thereof take up huge amounts of time and getting this resolved up front and beforehand makes life a lot easier and it will also greatly reduce the amount of time that is spent in the actual hearing.
Both parties should of course, document the entire meeting, making sure that all the issues that they have agreed to are correctly recorded as well as all the issues that were not agreed on. These minutes can then be signed off on by both parties that then can also be presented to the arbitrator who will use them to get a clear idea of key issues that are relevant to the case.
Be careful though that you don’t give away too much of your case. It is for this very reason that it is in your own interests to use someone who is an expert in Labour Law and it’s relevant processes and the negotiation thereof. If you don’t and the whole thing goes pear-shaped, it could cost you a great deal of money.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Preparing for Disputes – Part 2
By Nikki Viljoen of Viljoen Consulting CC November 2009
Following on from last week, today we are going to look at some of the most typical and also most important issues that can be discussed at the ‘pre-meeting’.
Some of the most typical and also important issues that are or can be dealt with are (but not limited to):
· Any means by which the dispute may be settled. Both parties would be expected to express exactly what they are wanting that would give them a sense of vindication. It is often at this point that an “out of court” settlement is reached and agreed to and once this agreement has been signed, the arbitration hearing would therefore be totally unnecessary .
· Facts that are the common cause. In some cases it is the ‘straw that breaks the camels back’ that mess the whole works up and it is easier and more beneficial to all parties to get consensus on these and to agree to the facts up front. Issues such as (but not limited to)
+ the exact date that an employee was employed
+ the exact date that the employee was dismissed
+ the exact reason for the dismissal
Here’s the thing – the more issues that can be agreed upon before the hearing, the less time (and expense) will be needed to establish the facts during the hearing.
· Facts that are in dispute. These are usually the issues that the parties cannot or will not agree on. These are issues such as (but not limited to)
+ the employees benefits
+ the employees package
+ the employees remuneration
+ whether the treatment by the employer was fair and/or unfair.
It may also include issues such as whether the employee was at the workplace on the day that the incident took place and so on.
Often at this point the parties may agree that the arbitrator will need decide if the dismissal was procedurally fair or unfair and also whether it was substantively unfair.
· Precise Relief claimed. Usually this is the discussion that takes place that highlights whether the employee wants to be re-instated or whether they want some kind of financial compensation.
It is also at this stage that the sharing and exchange of documents takes place and one ‘common’ bundle of documents can be compiled. Parties fighting about documents and their contents or lack thereof take up huge amounts of time and getting this resolved up front and beforehand makes life a lot easier and it will also greatly reduce the amount of time that is spent in the actual hearing.
Both parties should of course, document the entire meeting, making sure that all the issues that they have agreed to are correctly recorded as well as all the issues that were not agreed on. These minutes can then be signed off on by both parties that then can also be presented to the arbitrator who will use them to get a clear idea of key issues that are relevant to the case.
Be careful though that you don’t give away too much of your case. It is for this very reason that it is in your own interests to use someone who is an expert in Labour Law and it’s relevant processes and the negotiation thereof. If you don’t and the whole thing goes pear-shaped, it could cost you a great deal of money.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Thursday, November 26, 2009
SALES - Knowledge is Key
SALES – Knowledge is Key
By Nikki Viljoen – Viljoen Consulting CC November 2009.
I know that I am one of the most impatient people on the planet. Talk about instant gratification – when I want something, I want it right now! Sounds familiar doesn’t it? Fact of the matter is that I am no different from most people on the face of the earth and certainly no different from any of my SMME colleagues.
Here’s the thing though, you would not expect yourself to become proficient or an expert after one piano lesson or a master chef from reading one cookery book, so why on earth would you expect yourself to become an expert sales person after making just one sale? Doesn’t make any kind of logical sense now does it?
Like most things in life I have to keep learning about it, I have to keep reading up on it, I have to keep implementing what I have learnt. I have to keep up to date with the trends and what is happening in my working and business environment. Those of you who know me and who have been in my office will attest to the large piles of books, magazines and articles that I have all over the place, not to mention the pile of magazines in the bathroom and the toilet. As I have mentioned in some of my articles before, much of what I write is what I most need to hear and this is no exception. As I do the research for and write these articles for my blog and to share with my fellow SMME’s so I learn and grow my own business.
I understand that after almost 40 years since I was last in a classroom, I have to again become a student and learn, not only about selling but all the other skills that are needed as a small business owner. Skills such as branding and marketing, general business skills, skills around negotiation and the ‘how to’ of people skills and please don’t forget anything and everything around finance and tax. New technology also needs to be understood to a certain degree and for me that means knowing what can be done rather than how it does it.
Of late, I find myself becoming quite an information junkie, I devour books, magazines and shamelessly trawl the internet for information, I can’t seem to get enough and I also seem to need more and more.
Don’t forget though, although the saying is ‘knowledge is power’ the true power is unleashed when you do something with that knowledge! So don’t just be learning, make sure that you do something with your new found knowledge. That’s the key!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
By Nikki Viljoen – Viljoen Consulting CC November 2009.
I know that I am one of the most impatient people on the planet. Talk about instant gratification – when I want something, I want it right now! Sounds familiar doesn’t it? Fact of the matter is that I am no different from most people on the face of the earth and certainly no different from any of my SMME colleagues.
Here’s the thing though, you would not expect yourself to become proficient or an expert after one piano lesson or a master chef from reading one cookery book, so why on earth would you expect yourself to become an expert sales person after making just one sale? Doesn’t make any kind of logical sense now does it?
Like most things in life I have to keep learning about it, I have to keep reading up on it, I have to keep implementing what I have learnt. I have to keep up to date with the trends and what is happening in my working and business environment. Those of you who know me and who have been in my office will attest to the large piles of books, magazines and articles that I have all over the place, not to mention the pile of magazines in the bathroom and the toilet. As I have mentioned in some of my articles before, much of what I write is what I most need to hear and this is no exception. As I do the research for and write these articles for my blog and to share with my fellow SMME’s so I learn and grow my own business.
I understand that after almost 40 years since I was last in a classroom, I have to again become a student and learn, not only about selling but all the other skills that are needed as a small business owner. Skills such as branding and marketing, general business skills, skills around negotiation and the ‘how to’ of people skills and please don’t forget anything and everything around finance and tax. New technology also needs to be understood to a certain degree and for me that means knowing what can be done rather than how it does it.
Of late, I find myself becoming quite an information junkie, I devour books, magazines and shamelessly trawl the internet for information, I can’t seem to get enough and I also seem to need more and more.
Don’t forget though, although the saying is ‘knowledge is power’ the true power is unleashed when you do something with that knowledge! So don’t just be learning, make sure that you do something with your new found knowledge. That’s the key!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Wednesday, November 25, 2009
The Power of Networking - Part 139
THE POWER OF NETWORKING
PART 139
By Nikki Viljoen of N Viljoen Consulting CC. November 2009
I was reminded again yesterday about how trust is such an important factor in Networking and referrals.
You see my friend (let’s call her Jill) met me for lunch and was telling me about this huge opportunity that has presented itself to her. There is this chap (let’s call him John) who heads up a multi million Rand organisation who is looking for a particular product to brand as a corporate gift for his clients for 2010.
Jill had a meeting with him on an unrelated issue and he mentioned this corporate gift idea that he had and said that no-one had gotten back to him and that in fact he had had little response from anyone. How bizarre is that? The man wants to give someone huge amounts of money and/or business and no-one appears to wants the business!
Well now Jill, who is in a totally unrelated type of business, really does not know how to pass up on a good deal and she asks him if she could perhaps assist him and John gives her 24 hours to get back to him with a proposal. 24 hours people, in a field that she knows nothing about!
You would think that Jill’s initial reaction would be one of “Panic! I have no idea where to even begin to find what he needs” – well, in a way you could be right but more importantly you are most definitely wrong.
Here’s the thing – Jill may not know much about the product that she had 24 hours in which to come up with, but Jill knows me and Jill knows that I know lots of people. So Jill, who loves to work ‘smart’ rather than ‘hard’ called me!
So here is what happened – I have connected Jill with several people in my database, one in particular being (let’s call her Jane). Jill and Jane have never met one another, but because I referred both of them, one to the other, they are now doing business and John is a happy man. My contacts know and trust me and they also know how to deliver. The result is . . . . well let’s jus say that Jill owes me several large whiskeys!
Here are two people, who have yet to meet one another, who are doing hundreds of thousands of Rands worth of business because they both know and trust me.
Now that . . . is the Power of Networking!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
PART 139
By Nikki Viljoen of N Viljoen Consulting CC. November 2009
I was reminded again yesterday about how trust is such an important factor in Networking and referrals.
You see my friend (let’s call her Jill) met me for lunch and was telling me about this huge opportunity that has presented itself to her. There is this chap (let’s call him John) who heads up a multi million Rand organisation who is looking for a particular product to brand as a corporate gift for his clients for 2010.
Jill had a meeting with him on an unrelated issue and he mentioned this corporate gift idea that he had and said that no-one had gotten back to him and that in fact he had had little response from anyone. How bizarre is that? The man wants to give someone huge amounts of money and/or business and no-one appears to wants the business!
Well now Jill, who is in a totally unrelated type of business, really does not know how to pass up on a good deal and she asks him if she could perhaps assist him and John gives her 24 hours to get back to him with a proposal. 24 hours people, in a field that she knows nothing about!
You would think that Jill’s initial reaction would be one of “Panic! I have no idea where to even begin to find what he needs” – well, in a way you could be right but more importantly you are most definitely wrong.
Here’s the thing – Jill may not know much about the product that she had 24 hours in which to come up with, but Jill knows me and Jill knows that I know lots of people. So Jill, who loves to work ‘smart’ rather than ‘hard’ called me!
So here is what happened – I have connected Jill with several people in my database, one in particular being (let’s call her Jane). Jill and Jane have never met one another, but because I referred both of them, one to the other, they are now doing business and John is a happy man. My contacts know and trust me and they also know how to deliver. The result is . . . . well let’s jus say that Jill owes me several large whiskeys!
Here are two people, who have yet to meet one another, who are doing hundreds of thousands of Rands worth of business because they both know and trust me.
Now that . . . is the Power of Networking!
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
Tuesday, November 24, 2009
BUSINESS TIPS - What is Cash Flow?
BUSINESS TIPS – What is Cash Flow
By Nikki Viljoen – Viljoen Consulting CC November 2009
We all hear the words every day – “Cash is King”! Clearly it is preferable to have physical cash in your hand, than say a cheque or even money in the bank. Why do you think that that is?
Firstly if the money is in the bank, then there may be expenses that still need to go off your account, you would still need to go to the bank to draw money or alternatively you may not have the card or the correct access codes to get the money out of the bank. So having physical cash in your hand is always a good thing.
Let’s have a look at what cash flow is – exactly. Quite simply, it is the physical money that you have access to at any given time. It’s not the money that you are waiting to be paid. It’s not the stock that you are waiting to sell – it’s the physical cash that you have access to at any given time.
Having a good cash flow is absolutely imperative. As SMME’s (Small, Micro, Medium Enterprises) we need a good cash flow in order to purchase our supplies, to pay rent, to pay our staff and to pay our way in the every day manner in which we conduct our business. In short it is that lifeblood that we need in order to earn our livelihood, without it we would whither up and literally die.
So how do we get this ‘cash flow’?
First of all we need to get money into the business – this is usually referred to as a “cash inflow” and it is usually made of up four different components, these are:
· Sales of our products and/or services – well that’s pretty self explanatory.
· Loan or credit card proceeds – this is either money that we have loaned from a bank or financial institution or indeed money that we have loaned our business in our personal capacity and/or money that is coming to us from sales that were paid for by means of credit cards or indeed money that we have ‘borrowed’ on our credit cards, even money that is owed to us by our debtors.
· Asset Sales – this would be when we sell assets (such as old computers or vehicles etc) that were previously purchased by the company that we are now upgrading and/or even just getting rid of.
· Owner investments – these would be property and/or financial and/or business investments that we have made on behalf of our company.
Then of course money goes out of the business – this is usually referred to as “cash outflow” and again it is usually made up of four different components, these are:
· Business expenditures – these are of course the expenses that are raised in the normal day to day running of the business. This would also include salaries and wages etc for the staff.
· Loan or credit card principal payments – just as you got the money either from a loan or your credit card, now you have to pay that loan back or pay your credit card back.
· Asset purchases – again, just as you sold old equipment or equipment that you no longer needed, so now you have to buy new equipment and/or assets for the business.
· Owner withdrawals – again that is pretty self explanatory and it is when the owner takes money out of the business for personal use. These drawings are usually offset against the money that the owner has lent to the business out of his/her loan account.
Both the ‘Cash Inflows’ and the ‘Cash Outflows’ also fit into three main categories within the business and these are:
· Operating – this covers the sales of product and/or services of your business, together with the business expenses that you incur in the selling of your product and/or service.
· Investing – this would be all the assets that you buy and sell and
· Financing – this obviously covers all the loans and the repayments of the loans as well as the money that the owner has invested into his/her business and the withdrawals that he/she makes for personal use.
So there you have it, basically what cash flow is and the ‘how’ and ‘what’ it relates to.
Next week we will have a look at some simple tips on how to manage your cash flow.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
By Nikki Viljoen – Viljoen Consulting CC November 2009
We all hear the words every day – “Cash is King”! Clearly it is preferable to have physical cash in your hand, than say a cheque or even money in the bank. Why do you think that that is?
Firstly if the money is in the bank, then there may be expenses that still need to go off your account, you would still need to go to the bank to draw money or alternatively you may not have the card or the correct access codes to get the money out of the bank. So having physical cash in your hand is always a good thing.
Let’s have a look at what cash flow is – exactly. Quite simply, it is the physical money that you have access to at any given time. It’s not the money that you are waiting to be paid. It’s not the stock that you are waiting to sell – it’s the physical cash that you have access to at any given time.
Having a good cash flow is absolutely imperative. As SMME’s (Small, Micro, Medium Enterprises) we need a good cash flow in order to purchase our supplies, to pay rent, to pay our staff and to pay our way in the every day manner in which we conduct our business. In short it is that lifeblood that we need in order to earn our livelihood, without it we would whither up and literally die.
So how do we get this ‘cash flow’?
First of all we need to get money into the business – this is usually referred to as a “cash inflow” and it is usually made of up four different components, these are:
· Sales of our products and/or services – well that’s pretty self explanatory.
· Loan or credit card proceeds – this is either money that we have loaned from a bank or financial institution or indeed money that we have loaned our business in our personal capacity and/or money that is coming to us from sales that were paid for by means of credit cards or indeed money that we have ‘borrowed’ on our credit cards, even money that is owed to us by our debtors.
· Asset Sales – this would be when we sell assets (such as old computers or vehicles etc) that were previously purchased by the company that we are now upgrading and/or even just getting rid of.
· Owner investments – these would be property and/or financial and/or business investments that we have made on behalf of our company.
Then of course money goes out of the business – this is usually referred to as “cash outflow” and again it is usually made up of four different components, these are:
· Business expenditures – these are of course the expenses that are raised in the normal day to day running of the business. This would also include salaries and wages etc for the staff.
· Loan or credit card principal payments – just as you got the money either from a loan or your credit card, now you have to pay that loan back or pay your credit card back.
· Asset purchases – again, just as you sold old equipment or equipment that you no longer needed, so now you have to buy new equipment and/or assets for the business.
· Owner withdrawals – again that is pretty self explanatory and it is when the owner takes money out of the business for personal use. These drawings are usually offset against the money that the owner has lent to the business out of his/her loan account.
Both the ‘Cash Inflows’ and the ‘Cash Outflows’ also fit into three main categories within the business and these are:
· Operating – this covers the sales of product and/or services of your business, together with the business expenses that you incur in the selling of your product and/or service.
· Investing – this would be all the assets that you buy and sell and
· Financing – this obviously covers all the loans and the repayments of the loans as well as the money that the owner has invested into his/her business and the withdrawals that he/she makes for personal use.
So there you have it, basically what cash flow is and the ‘how’ and ‘what’ it relates to.
Next week we will have a look at some simple tips on how to manage your cash flow.
Nikki is an Internal Auditor and Business Administration Specialist who can be contacted on 083 702 8849 or nikki@viljoenconsulting.co.za or http://www.viljoenconsulting.co.za
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