How will you do in 2012?  I think the key to your business’s success is pretty simple.  It all comes down to execution.

For many, this is easier said than done.  You’re either  going to dig deep inside and turn the switch from pilot light to ON or you will move through 2012 with a lot of talk about what you need to do.

Step 1:  Ignite the pilot light

Step 2:  Turn the switch to on

Step 3:  Prepare for lift off

Step 4:  Set your sights on immediate short-term success

Step 5:  Move quickly to get your first win

Step 6:  Celebrate each victory with your team

Step 7:  Implement your next strategy

Step 8:  Repeat steps 4-7!

With each success, you will find the fire building within.  Capitalize on this momentum.  Plan on less talking about “it” and more doing “it” as you walk down the path you desire.

Until next time…soar to new heights with your flame aglow and leave the hot air behind.

What about you?  What do you want to do?  Will your time be filled with travel, helping in the community or just not having a schedule?  All of the above sounds like a start but what else?  Obviously, I am not ready to retire because I am still worried about having a list to check off.

Recently we had a family vacation in Maui.  My kids are young adults which made this vacation even more special.  This year we enjoyed a true vacation as the kids volunteered to cook dinner and clean-up.  Many an evening I sat on our lanai sipping a beverage while watching the sunset with no schedule on hand – it was a nice vision for retirement.   But how realistic is that?

So here I sit wondering if retirement will be all that it is cracked up to be.  I think before I get to that day I am going to take it for a test drive.

Until next time…how do you see your sunset years?

Growing your business is what you’re supposed to do, right?  Talk to any business leader or member of academia — they will tell you that without growth you will eventually die.  Sure, if your business never grew and your expenses continued to rise you would eventually lose money.  But what about right NOW?

With the economy starting to move forward, most companies are happy to see any sign of growth.  But how do we define growth?  Typically we look at sales year over year.  Since we hit the bottom in 2009, any kind of growth feels good.  But maybe we shouldn’t be so excited about comparing 2010 to 2009.  Maybe we should be comparing our current sales with 2006 or 2007 to see how much progress we have truly made.

How can growth be a bad thing?  Sales growth, without a clear picture of the impact it can have on cash flows can be devastating to a business.  Most businesses are already cash-strapped. They have tapped into both their rainy day fund and their lines of credit just to stay afloat during this recession.  As sales begin to grow, so will their required investment in inventory and accounts receivable.  These two assets are often misunderstood when it comes to cash flow.

Let’s start with accounts receivable.  AR represents what your customers owe you for the products or services you have sold them.  As your sales grow, so will your accounts receivable.  With this growth comes a delay in cash received.  Even if your customers pay you on time, this incremental growth may squeeze your bank account.  As a general rule your AR should grow at the same rate as your credit sales.  If the rate of growth in AR exceeds your credit sales growth, your collection times are growing. This can have a serious negative impact on cash.

Inventory is a black hole when it comes to cash.  Whether you’re a retailer or a manufacturer, when it comes to inventory, you are walking a tightrope. You must balance your need to have enough inventory on-hand to meet sales demand against the high cost of carrying excess inventory.  Ideally, you need a way to predict what demand will be.  Any slowdown in sales could result in excess inventory (i.e. cash) sitting on your shelf while your day to day expenses (cash out) continue.

Now is the time to have a good cash forecast in place.  You need to understand the squeeze your growth is going to put on your already weak cash and credit position.  One wrong move could spell disaster, just when you thought you were on the road to success.

Until next time…understanding where you’re going can reduce the detours along the way.

After the conference we spent two days in Old San Juan.  This is quite a city with real Caribbean history.  Here we took a two hour Segway Tour.  For those that don’t keep up with interesting gadgets, these are the two wheel scooters that you stand on and gyroscopes keep it upright.  You simply lean forward and it goes forward.  Lean back and it stops or goes backward.  Push the handle left or right and it turns.  Great fun and a great way to get around a city causing zero pollution.  It’s also a hoot to ride around on! 

The owner of the Segway Tour Company, Jose, was our guide to the city and he was great.  It was a slow day for him so it was just Kathi and I which made it very special for us.  Jose had the most fantastic knowledge of the city and its history and was very personable and fun as well.  If you ever find yourself in old San Juan be sure to take this tour with Jose.  You will have a great time and because of Jose, will learn the true history of a fascinating place, and of course get to ride a Segway.

I asked Jose how business was lately and he said it was still doing pretty well even though the cruise ships that start and stop in San Juan are off about 25%.  Not much different than here but Jose had a great observation about it.  His business was still doing  well and he knew why. 

His tour was the best it could be and he made sure that it would always be seen as the best by delivering a unique and quality experience.   He then went on to say that times like this weed out the businesses that aren’t that well run and that the best run businesses would survive and be stronger.  He gave us an example as we talked about the restaurants we visited in old San Juan.  We made our choices by consulting a web site, Tripadvisor.com.  This was also how we found Jose’s tour.  We had some truly great meals and the restaurants were pretty full.  This was not true of other restaurants. They were really struggling.  They probably just assumed it was because of the poor economy when in fact it was because they just weren’t good enough. 

 In times like these, quality and attention to your customer’s needs will surely mean the difference between survival and failure.  Just ask Jose, he knows!