GROWTH MANAGEMENT EXPLAINED

Growth Management is the process in place to ensure that the company’s market value increases on a consistent basis.
The following key tenets will ensure growth on a long-term basis:

1. Identify the major sources of Stress or Failure

• Determine the real causes of the company’s financial problems and address them with a bold and practical action plan.

2. Increase Cash Reserves to meet long-term financial obligations

• Implement robust accounts receivable collection program to reduce overall financial stress
• Reduce progressively inventory to reduce holding costs
• Establish priority payment on accounts payable to conserve cash
• Consolidate all purchasing if possible to generate savings

3. Reduce Operating Costs as necessary

• Activate an emergency cost structure that will eliminate all non-survival expenses in case of business slow-downs. This structure will stay activated until the business is financially sound again.

SOLUTIONS

Analyze and manage the growth the company on a monthly or yearly basis and gather the following information:

• Net Profit Margin (Return On Investment)
• Operating Profit Margin (Return On Investment Before Interest and taxes)
• Gross Margin ( Return On Investment Before Variable and Fixed Costs)
• Break-even Amounts by period (The minimum amount required to remain operational)
• Retained Earnings (The progressive amount retained into the company’s balance sheet)
• Balance Sheet Overview (Equity, Assets, Liabilities)
• Debt/Asset Overview (Financial Stability)
• Efficiency Ratios (Key Financial Performance Indicators)
• Cash Flow Overview (Cash Financed, Cash Invested, Operating Cash, Net Cash Flow)
• Working Capital Overview (Current cash available after paying current liabilities)

RESULTS

• Greater assurance that the business will remain viable on a long-term basis
• Interest from investors because the business would demonstrate progressive growth
• Progressive growth of the company and greater marketability