Achieving Business Health with Loan Doctor Tips and Business Loans

By Eugene E. Valdez AKA The Loan Doctor™

As the self-proclaimed Loan Doctor, I have found that all of my CEO clients want the same thing- a healthy company.  For each CEO “health” may be defined in different ways but normally it is defined as a stable business that generates consistent sales and profits and affords the CEO and his or her family a comfortable lifestyle.

The “health medicine” I dispense to my clients consists of several strategic business actions coupled with a well thought business loan acquisition plan. For this week’s article I would like to share some of these strategic bits of medicine. These are just my opinions; many business experts may have a list entirely different than mine.

Here Are My Business Health tips:

1. Monitor your business cash flow like it was your personal blood pressure- Learn how to budget your cash flow in 90 day increments. Do a variance analysis of actual versus budgeted. Remember your cash flow is the company check book: cash in minus cash out equals cash flow.
2. Constantly review your business model- External and internal forces are constantly impacting your position in the market. Make sure your value proposition is always razor edge versus your competitors.
3. Go overboard to keep your customers happy- As the old saying goes, your customers are your competitor’s prospects. Loyal customers, who pay on time and don’t grind you on pricing are gold, treat them as such. Never take them for granted, don’t meet their expectations- insanely exceed them—- every time!
4. Go overboard to keep your employees happy– Most of the time they are the ones that will keep your customers happy. If they’re not happy it will affect their “bedside manner”.
5. Don’t grow too quickly- Excessive sale growth is taxing on every body, your management ability, your staff, your operations, your cash flow and quality control. The name of the game is more profits not more sales per se just to satisfy your ego.
6. Strive to keep your cost structure more variable than fixed – This will allow you to control your costs better when your monthly sales decline unexpectedly (or expectedly). High levels of fixed costs are risky to carry.
7. Monitor Your Account Receivables Fanatically – Put collection policies in place, create quality reports and hire and train employees on how to manage this department well.  The benefit is obvious.
8. Learn how and to review company financials every month. This is the Achilles heel of 60% of my clients.  Review your balance sheets, income statements and statements of cash flow.  Hire somebody to help you “see the numbers” more clearly. Create high quality internal accounting systems. Hire a very competent CPA who will prepare financials that you will share with bankers and lenders.
9. Develop Your Brand Via A Social Media Marketing Plan- It is critical to develop or enhance your company brand. Your brand is “your promise” as to what your products or services will do for your current customers and interested prospects.
10. Obtain a Business Line of Credit- This line will represent your emergency source of cash when your “organic cash flow” is lacking. You have to “earn” this line, it won’t be given to you, unless you want to tap an on-line lender and pay 25%-50% interest. (Ouch!)

               See you next week.

Eugene E. Valdez is President and CEO of The Loan Doctor and Associates, Inc., a full service banking and finance consulting company located in Upland, CA.  He can be reached at 909-230-0024. Like and follow him on social media Facebook, LinkedIn.

*Have a question for our business advice column or an issue you would like to see addressed in our weekly column? Let us know at [email protected]. Contributors to the column are Inland Empire professionals who are experts in their particular discipline.