Posts by GPS
The New Generation Gap
By GPSWhen my wife, Sandra, and I recently interviewed candidates for staff positions in the undergraduate residence we oversee at Harvard, she referred to someone as “in his 50’s, our age.” I shook my head, instinctively warding off the association, then recognized the accuracy of her reference. “Right,” I muttered. Our candidate, a 30-something who had worked in the Clinton White House, smiled knowingly. His smile felt sympathetic, but it said to me: “baby boomers will go to their collective grave believing they’re still fresh out of college.”
Former President Clinton derives much of his charm from this surety, and our …
Professional Level Sales
By GPS
The sales paradigm:
It is likely that once upon a time a caveman figured out he could trade his surplus of arrowheads for food and drink; and the rest was commerce history. Sales methodologies have evolved over many decades to the practices employed today. In the past, salesmen suffocated prospective buyers with aggressive techniques. Today a more professional sales discipline is surfacing. New methods have been designed specifically to invite product exploration. As long as there has been commerce, there have been sales. One dynamic remains unaltered. A series of relational changes transpire between the seller and the buyer from …
Reveal Your Company’s Hidden Appeal
By GPSPosition your company as an attractive investment
Last year was a good year for both the U.S. and Canadian merger and acquisition (M&A) markets, and 2007 is forecast to eclipse 2006’s deal-making activity. According to market analysts, a large number of private-business owners are expected to sell their companies in 2007.
These transfers will be driven by the modest, yet sound profits generated in 2006, an expectation of continued increases in profits in 2007, an economy projected to slow in 2008, an existing surplus of capital allocated for funding anticipated acquisitions, and an increase in the number of strategic buyers.…
Mistaking The Scorecard For The Game
By GPSWhen Amazon.com, the online bookseller, went public it instantly had a market cap of $6.5 billion, yet it had never earned a single dollar of profit in its four years of business. In 1998, Microsoft paid $400 million for the e-mail company, Hotmail.com before it ever earned a single dollar of profit.
How is this possible? Their scorecards (reported quarterly profits, price/earnings ratios, return on equity, etc.) are littered with negative numbers, yet they command incredible value in the market place. Is it possibly because they radiate the greatest competitive advantage in business–innovation?
Concepts like rightsizing, Six Sigma, TQM, incremental …
Establishing Small Business Profitability
By GPSA systematic financial review can lead to greater profits
There are several elements within a small business environment that should be analyzed and reviewed to establish potential profitability as compared to current performance.
Financial statement review
In a review, three to five years of financial statements should be analyzed and categorized. Compare the performance of each category within the chart of accounts over the financial review time period. Categories should include types of revenue, variable or direct costs, indirect overhead, general and administrative overhead, debt service and leases.
Break down each dollar amount into a percentage of revenue to determine …
10 Reasons Businesses Fail
By GPSNearly anyone can start a business, but it takes more than technical expertise and gut instinct to grow it successfully. Here are the top 10 reasons businesses fail, and what you can do to support your success.
- Inadequate financial records. A seemingly small task, such as keeping detailed books and appropriate records of sales and expenses, can affect the success of a business. You need to understand how much money is on hand and how much is owed in order to understand the financial picture. Keep records detailed and current.
- Disregard for or misinterpretation of financial records. Improper funding and
A Survival Model For The Small Restaurateur
By GPSWith so much media attention focused on large industry players in the financial and manufacturing sectors, the food and beverage sector has been somewhat ignored. This article provides a survival model for the small restaurant owner.
The economic downturn has affected all domestic businesses; however, media attention is focused mainly on the large players in the financial and manufacturing sectors. Rescue programs, commonly called “bail-outs,” abound, while the food and beverage sector, driven mostly by discretionary spending, is largely ignored by both the media and the government. Families are tightening their belts, and businesses are slashing travel and related expenses.…
Tax Efficient Transfers Of A Family Business
By GPSHow to Utilize a Grantor Retained Annuity Trust (GRAT) to Efficiently Transfer Your Family Business
Use of a Grantor Retained Annuity Trust, or GRAT, is a well-established gift and estate tax planning technique for transferring appreciating assets to beneficiaries without adverse gift tax consequences. A GRAT is often referred to as an “estate freezing” device because it allows an asset to be transferred to another party (the named beneficiary of the GRAT) at a future date, but allows the value of the gift to be calculated based on the asset’s value on the date it was contributed to the GRAT. …
Buyer Beware! No, Seller Beware!
By GPSWhat every seller should know about a business sale transaction.
The statistics and projections are staggering:
- It is projected that the number of new businesses will increase by 22% every five years.
- “An estimate of 65% to 75% of all small businesses will go up for sale in the next five to 10 years. Why? Retiring baby boomers.” – Inc. Magazine, April 2008.
- A PricewaterhouseCoopers survey confirms that one out of every two company owners intend to sell their businesses within the next 10 years.
- The Exit Planning Institute projects that in the next 12 to 15 years, in excess
Don’t Get Caught With Your Hand In The Cookie Jar
By GPSFiduciary Duties of Directors and Officers of Closely Held Corporations
As a controlling shareholder of a closely held corporation, were you ever tempted to take a higher salary in a profitable year even if it meant decreasing bottom-line profits available for distribution to other shareholders? Were you ever tempted to do a “side job” and take cash for yourself, rather than running business through your corporation? Have you ever claimed lack of knowledge of internal financials and tax returns as a defense against early detection of wrongdoing? If so, think again before acting on these temptations, as you don’t want …
