“Fueling” Your Business With High Octane

ARI BAUM CFP®

OWNING A PROFITABLE BUSINESS IS LIKE BEING A PROFESSIONAL RACE CAR DRIVER. YOU’RE CONTINUALLY TUNING YOUR CAR, STUDYING THE COURSE, AND COMPETING WITH SOME OF THE HIGHEST STAKES POSSIBLE. IF YOU SLOW DOWN, YOU FAIL, SO YOU GET COMFORTABLE MAKING STRATEGIC DECISIONS AT 200+ MPH. AS THE DRIVER, YOU’VE GOT THE SELF-CONFIDENCE TO ACCEPT THE RISKS AND DRIVE YOUR CAR TO THE LIMIT.

BIG MOVES REQUIRE MORE THAN A DRIVER IN THE SEAT.
All pro drivers have a dedicated crew that helps them build winning strategies, keeps their car in optimized condition and communicates with them during every race. To win, the driver relies on the team to call out the turns, monitor the competition, and keep an eagle eye-view of the course. The team leaves the driver free to focus on synthesizing the information and making split-second decisions with life-or-death consequences. Decisions like how to burn ahead of a competitor, or when to swap tires as conditions change, or which line to take around a treacherous curve.

SOUNDS LIKE RUNNING A HIGH GROWTH BUSINESS, RIGHT?
But are you getting the most out of your business? Is it a clunker or a supercar? Are you racing at peak performance or idling in the pit?

The next step requires coordination and strategic decisions that are hard to make when you’re stuck in the pit instead of in the driver’s seat.

Imagine a future where:
• Your financial “pit crew” meets together and your advice is fully integrated, allowing you to focus on your business and personal time.
• You feel in control at the wheel and confident that you’ve got the information you need to make the right calls.
• You have confidence and clarity in your vision for the future and the steps to get there.
• You enjoy life and take advantage of more freedom from day-to-day.

FUEL YOUR NEXT BIG MOVE BY UNDERSTANDING THESE KEY DRIVERS
Being a business owner means your financial landscape is more complex than the average W-2 wage earner. Each piece of your strategy has implications for the rest, and you have to keep the whole picture in mind when making your next big move.

DRIVER #1: YOUR BUSINESS FUNDAMENTALS
How much time are you spending “in” the business versus “on” business strategy?
Is your answer:
10%–20% “in”
30%–40% “in”
50%+ “in”

Is your business generating enough profit for you to accomplish your dreams?

What would be the next level for your business? (write it down on a piece of paper.)

If you’re targeting growth, how will you fund it?
Cash
Credit or Debt Financing
Outside Investment
Personal Loan
Other

Do you have a benefits strategy to hire and retain talent in today’s competitive labor market?

Do you have incentives to align your team around your growth?

Do you understand the true market value of your business?

Have you identified all the exits for your business and how to achieve the most value when it’s time to go?

DRIVER #2: CASH “FUEL” STRATEGY
Are you a big spender or frugal with your cash?

Do you have your cash flow forecasted to keep your business healthy for the next 12 months?

Have you identified any “hidden” cash flow in your assets, inventories, receivables, or prepaid expenses?

Have you built a cash “war chest” to take advantage of opportunities and get through any lean times?

Do you have a plan for any seasonal factors in your business, so you can cover payroll and other fixed expenses?

Do you have adequate credit available?

Is your payroll optimized so you get paid before you pay your employees?

Have you negotiated “pay slow” payment terms with your vendors?

Do you have “invoice fast” processes in place?

Does someone in your business own receivables and collections?

DRIVER #3: YOUR PERSONAL FINANCIAL STRATEGY
Are you taking enough profits from the business to build your personal wealth?

Are you balancing reinvesting in the business and drawing profits for yourself?

Are you taking your income the right way (to help minimize taxes while still showing enough to qualify for financing)?

Are you taking full advantage of your investment opportunities as an owner and employee?

Are you leveraging the advanced investing strategies only available to successful entrepreneurs to diversify your wealth?

Are you keeping your investments in the right kind of accounts (taxable, tax-deferred, tax-free) to help minimize your taxes now and potentially maximize your income later (even if you retire before age 55)?

Are you fully leveraging the 1,000+ pages of tax code written specifically for you (especially the 2017 tax reform rules that are highly beneficial to businesses)?

Do you have enough insurance on yourself (and your spouse) to protect your family?

ARE YOU READY TO CLIMB OUT OF THE PIT AND GET BACK IN THE DRIVER’S SEAT?

As the owner of a successful business, you’ve proven that you have the unique ability to identify opportunities and use your competitive edge potentially to turn them into prosperity. You’ve turned a scrappy idea into a finely tuned profit-making machine.

• But are you getting enough out of your business to achieve your big audacious dreams?

• Are you leveraging your financials and unique strengths to make the most of your next big move?

Making a big move in your business—whether it’s taking on a new market, acquiring a competitor, transitioning out of the day-to-day, or exiting—requires the coordination and strategy of a pro racing team with you in the driver’s seat. You can’t drive the car if you’re stuck in the pit instead of the driver’s seat. As a business owner, your job is to assemble the best “pit crew” and trust them to feed you the data, help you navigate the course, and outsmart the competition. If you want to move faster, be more profitable, and build your personal wealth, everything you want to accomplish in business and life starts with the right strategy and the right team to help you execute.

This content is developed from sources believed to be reliable; no warranty, expressed or implied, is made regarding accuracy, adequacy, completeness, legality, reliability, or usefulness of any information. Consult your financial professional before making any decision. Investing involves risk including the potential loss of principal. No strategy can guarantee a profit or protect against a loss in periods of declining value. Past performance does not guarantee future results.

Ari Baum, CFP® is the founder and CEO of Endurance Wealth Partners, with over a quarter of a century of experience in the Financial Services industry. He brings his in-depth experience to Conceive. Believe. Achieve. for his clients.

Brokerage and Advisory accounts carried by Wells Fargo Clearing Services, LLC. Securities and Advisory services offered through Prospera Financial Services Inc. Member FINRA/SIPC.