FLGOVCON40- GovCon Math Cash Flow - Solvability
(256) 882-6276

In this episode Jenny breaks down the do’s and don’ts of the cash flow and explains the process for her examples.

Don’t Do This:
1. Take Draws when needed instead of establishing salary
2. Be liberal with personal loans to employees
3. Give bonuses when you hear you’ve won
4. Sign up for season tickets with your favorite sports team
5. Celebrate your success with a new sports car
6. Buy a new house just before you negotiate your Line of Credit
7. Float your company across credit cards
8. Pay yourself well and hire family members
9. Generously pay your consultants & subcontractors early
10. Borrow from the company to pay your income taxes
Do This:
1. Corporate Structure – S Corp instead of LLC
2. Buy Sell Agreement and Key Man Insurance
3. Determine needs of owners – equity, work effort, pay, benefits
4. Pay Back Shareholder Loans before increasing salary/benefits
5. Don’t use up all your CASH to reduce your year-end taxes
6. Use company credit cards only for business – set a good example
7.Create a line between personal and business – don’t subsidize or use business funds for personal
8. Arrange for line of credit with bank
9. Finance capital investments with term loans
10. Preserve your personal credit during business growth
11. Invest in automated and outsourced corporate services to keep headcount balanced
12. Let initial billings go about 90 days to catch up gap between new hires
13. Pay Subs on a Pay When Paid plus 5 days Basis
14. Wait for profit to be realized before bonuses/pay raises
15. Create an owner’s bonus/compensation plan with a GOVCON business advisor (STEP)
16. Know your strategy for Succession, Transition, Exit and Planning
17. Regular meetings with executives on financial status and cash flow

To contact Jenny W Clark

CEO, Solvability, Inc


Phone 256-882-6276
E-mail jwclark@solvability.com
Linkedin Solvabilityjwc
Twitter Solvabilityjwc


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