Working capital is an important measure of a company’s financial health.   It’s defined as the difference between Current Assets and Current Liabilities (Working Capital = Current Assets – Current Liabilities).  When a company has positive working capital, it is able to pay off its short-term liabilities from assets that can be quickly converted to cash.    Inventory is a part of current assets and therefore has a direct impact on working capital levels.   Because of its impact on working … [Read more...]

It’s a common problem faced by businesses that build a good-sized customer base over time.  A customer leaves a deposit, uses your services for a few years then moves on.  They forget to ask for the deposit back and you are focused on getting new business, so returning that deposit doesn’t exactly keep you up at night.  When certain conditions are met, property like this deposit can no longer be held by your business. It must be turned over to the state government.  Failure to do so can result … [Read more...]

Sometimes it’s the little details that business owners miss that can lead to major problems. When it comes to paying your employees, knowing what times and activities require payment and which ones do not is critically important.  If you get it wrong, you could overpay or expose yourself to legal and financial risks for underpayment.   The Fair Labor Standards Act The Fair Labor Standards Act (“FLSA”) “establishes minimum wage, overtime pay, recordkeeping and youth employment standards.”  If … [Read more...]

The U.S. Census Bureau tracks a great deal more than just population statistics.  They manage many thousands of data series’ including those that measure retail sales in the U.S. These reports and surveys include the:  Advance Monthly Retail Trade Survey Monthly Retail Trade Survey Annual Retail Trade Survey Quarterly E-commerce Report Business Expense Supplement Together these reports give a comprehensive and robust view of retail sales in the country.  The Advance Monthly … [Read more...]

Mike Periu on How to fire back when your profits are under attack As the economy continues its precarious path forward, consumers and business customers maintain a price-conscious attitude.  Many large companies have made the decision to use price reductions, sales and rebates to increase (or maintain) unit sales.  This tends to cause a great deal of grief to small business owners who are forced to decide how to respond.    In most cases, it would be a mistake to go head to head on pricing … [Read more...]

The Dodd-Frank Wall Street Reform and Consumer Protection Act became law in July of this year.  I have previously written about some provisions of this far-reaching law such as changes with interchange fees.  Given its more than 2,300 pages and broad scope, the impact on businesses continues to be understood with new revelations still being brought to light.  There is one little-noticed section of the law whose impact could be significant given the mechanics required to implement it.  If you … [Read more...]

Since 1968, J.D. Power and Associates has conducted thousands of independent and unbiased surveys of customer satisfaction, product quality and buyer behavior. It has rated and ranked a range of products and companies, from cars and boats to pharmacies and moving companies. Many consumers consider the company an authority. They use products or services that rank highly. Business owners get good information, too. A survey of particular interest to business owners is the small-business banking … [Read more...]