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Category Archives: Finance

Business Failure

The flipside of "success” is "failure” and it’s the latter that every business owner and manager strive hard to avoid. By definition, the term "business failure” refers to the cessation of a company’s operations following its inability to generate enough revenue to cover expenses without adequate reserves. In the recent times, there are many examples of strong businesses that have failed to adjust to the changing markets and economic times or to take advantage of opportunities – and this has ultimately led to their downfall. Based on my 26 years experience working closely with business owners, here are my 9 key tips to avoiding business failure: 1. always ensure that you target your marketing. Too many businesses have an undifferentiated product/service offering and fail to understand who their target customer is and what they require. Don’t be undifferentiated, make sure you’re speaking the right language and...

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The Neat Analysis

NEAT Analysis We have developed a simple methodology for looking at our marketing and business development options and have called it NEAT, which stands for: Number of Customers Efficiency % Average Sale $ Transaction frequency Now, N x E x A x T = Profit You can look at NEAT from a whole business perspective or on a business unit basis, if required. It is usually done on an annual basis. Number of Customers simply stands for the number of Active Customers in your business. In most businesses active customers will be those that have purchased off you in the last year or two. In high turnover businesses , eg. NewsAgents, active customers could be those that have purchased off you in the last 3 months. In the building industry, it could be people that have purchased off you in the last 5 to 10 years. In...

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