Business Acumen - Ken Flamer
-
Upload
ken-flamer -
Category
Business
-
view
324 -
download
3
Transcript of Business Acumen - Ken Flamer
Business Acumen
• Understand the financial components of business
• Identify the levers that affect profitability
• Relate your personal finances to business finances
• Make more profitable decisions
After this course you should:
Business Acumen
What is it?
Business Acumen
What is it?Keenness and Quickness in understanding and dealing with a business situation in a manner that is likely to lead to a good outcome.
Improve Profitability
Business Acumen
How?
Making good decisions
How does the board look at the company?
Company View
Business Acumen
Bottom line
How does the CEO see the store as a unit?
Business Acumen
Store as a unit
Talent and the P&L
Series of numbersWhat line item does your role impact the most?
Revenue
PROFIT
Business Acumen
Margin
SG&A
What is revenue?
Business Acumen
What is margin?
Business Acumen
Selling price minus purchase price
What effects margin?
Business Acumen
Discounting Obsolescence
Returns
Incorrect Stock Position
Coupons
Damaged Gear
Shrink
Competition
. . . and more
What does this stand for?
SG&A
Business Acumen
Selling, General & Administrative
SG&A
Business Acumen
Payroll
T & E
Marketing
Rent &Utilities
Supplies Hardware
Profit
Business Acumen
Revenue minus expenses - EBITDA
What is wealth?
More passive income than expenses
Personal Finances
Business Acumen
What is your personal revenue?
Business Acumen
Salary, Bonus, Passive Income
What is your personal margin?
Business Acumen
Wages minus costs associated with earning them
What is your personal SG&A?
Business Acumen
Rent, “workers,” T&E, utilities, food
What is your personal profit?
Business Acumen
Savings, investments, money not needed for 60 days
What happens if you spend every dime you make?
What happens if you don’t spend any money (besides on essentials)?
Long-term vs. Short-term
Business Acumen
No cash, no savings, miss opportunities, no long-term prospects
No growth, old equipment, appearance is poor, no long-term prospects
Long-term vs. Short-term
Business Acumen
Spend
All
Spend
None
How do we increase revenue?
Business Acumen
More customers1
Maximize each customer
Business Acumen
2
Growth
What can we do?
• Anything to keep expenses down
• Anything to help others see how their daily decisions impact the financials of the company
• Anything to bring in more revenue
StoreRevenue
Margin
SG&A
Profit
PersonalSalary, bonus
Car, Gas, Clothes, Lunch
Rent, T&E, Services
Savings
Finance Grid
Business Acumen
Putting it all together
Business Acumen
Make better decisions