In the earlier period, traveler had to go from side to side hotels or travel agents to make a lodge booking phone system or writing. There was limited information about the room rates, services and facilities available to the traveler except through printed. There are many such websites out there but you should look for one that provides reliable and accurate information. The benefits to this phone system are significant time savings on what would otherwise be labor intensive tasks and consistency in marketing messages. It also means that businesses never need worry about losing customers. The employees too can check their account balance of phone or the Internet. These call recording have various benefits compared to various methods of sound.
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Proprietors, administrators and executives can take the time to plan for organizational needs by creating the technical documents that will secure organizational success. Most companies leaders know that it is best to start with the business plan; but don’t stop there! Using all of the resources available to create the most dynamic organization possible develops a strong foundation and nurtures a healthy future. Proper planning will allow a company to create and reach measurable goals while noting milestones along the way. Some of those all important documents are as follows:

Business Plan

In a world where “seven out of ten new employer firms last at least two years, and about half survive five years” [information published by sba.gov] an entrepreneur must have a solid business plan to keep site of measurable goals and objectives. When prepared correctly, a business plan functions as an organizational road map and ensures profits and working capital are rarely far from hand. And when prepared with care, taking the time to develop accurate data helps ensure funding for start up companies and expansion resources for existing companies.

Marketing Plan

Having a business plan and a new tri-color logo may be nice, but it does not exactly generate profits by sitting on an office shelf or on a secure website domain. Companies must work to ensure that buzz is created around the ideas have been worked so hard to establish as concrete product and service offerings. Having a realistic budget, strategy and expectations for a marketing and advertising presence within an organization is essential to growth.

Sales Plan

In additional to a marketing plan, a sales program should be put in place. Such a plan ensures that the dollars spent on marketing campaigns are generating the highest return on investment. This includes components like having professionals on the sales team and providing training and management support to assist them in their endeavors. The sales plan is like the cherry on top of the marketing plan sundae.

Department Plan

This can be a simple template outlining the departments that are required for a company to function at its highest level and the components needed to create such a physical department or a presence to ensure the roles for that department are fulfilled.

Culture Plan

Questions of morale, productivity and even standard operating procedures have their core in a company’s culture. Make sure that time is spent developing the organizational culture to produce an intended outcome. Starting with the company values, clearly outline exactly what is important within the company and how those items will be nurtured to grow along with the company and its team members.

Exit Plan

An exit plan allows organizational leaders to close the company doors when they decide and on their own terms; just as when the doors first opened. It gives proprietors control and piece on mind for an uncertain future. Should the inventory be sold by itself or with the company? Who will get the rights to the company name? What will happen to lists and database information? These should all be items that the owner and/or partners decide [before the decision has to be made].
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Business growth and profitability. Most entrepreneurs would consider these to be the Holy Grail of business ownership. So it’s not too surprising that many participants in the financial workshops I lead are surprised when I tell them that instant profits and rapid business growth aren’t always a cause for celebration.

“How can this be?” you might be wondering. The best way to explain it is to tell the story of the Wonder Widget Company. Haven’t heard of them? Well, this is a fictitious company I made up to help me explain business financial concepts in an easy-to-understand way.

A Hot New Launch

Wonder Widget Co. launched last year with $100,000 in cash and the hottest new product in its market, the amazing Wonder Widget. It was so hot that the owners had sales and profits the very first month of operations. So they quickly leased and outfitted a factory, production equipment and furnishings (all with minimal initial cash outlay), bought materials, hired workers, and manufactured and shipped widgets. Then they mailed invoices totaling $50,000 to customers in the first month. Amazing!

They paid their bills as they came due and collected from customers in the normal course of doing business. Meanwhile, sales continued to grow, increasing by $50,000 every month with no decline in margins and no serious competition, and profits climbed without a pause.

But a strange thing happened on the way to the bank: The owners were shocked to find that they didn’t have enough cash to pay their bills. Soon, they couldn’t buy any more raw materials to manufacture Wonder Widgets or make their payroll. Instantly profitable Wonder Widget Co. was insolvent six months after they opened the doors.

On the surface, it’s hard to see how something like this could happen to a profitable and growing business. But when you dig a little deeper, it becomes clear that there’s a whole lot more to running a successful business than just profits and growth-namely, cash flow.

The Cash Flow Cycle

Understanding what happened to Wonder Widget Co. starts by understanding what’s known as the cash flow cycle. This is the time lag that exists between when cash is paid out by the business for things like equipment, raw materials and salaries and when accounts receivable are collected. In manufacturing, the cycle usually consists of converting cash into raw materials, finished goods, receivables, and then back to cash again.

At the beginning of the cash flow cycle, nearly every business starts out with-you guessed it-cash. But from that point on, the central purpose of the business is to convert that cash into other kinds of assets or to leverage or extend it with liabilities, and ultimately to turn it back into cash again-but this time, more cash than the business started with. This process continues indefinitely and simultaneously throughout the life of a business.

When the company started up, its first activities revolved around setup-renting facilities, getting phones and utilities installed, etc. At the same time, it was purchasing assets so it could start operations. These included office equipment, computers and the like. Of course, the company also needed employees to answer phones, run the office, and produce and sell Wonder Widgets. The owners financed some of these costs, but obtained credit via bank loans to cover most of them.

With all this in place, the company was ready to begin production, or the manufacture of Wonder Widgets. Unfortunately, the process consumed even more cash: wages, taxes, sales and marketing, more raw materials, and so on. In fact, this is the period of greatest cash consumption for most companies, as they are in full production mode but no cash is coming in yet.

Finally, Wonder Widgets was ready to sell its products and begin the process of recovering all the cash it has been spending (or investing) in the business. However, while sales were brisk, they were made on “net-30″ day terms, which means the company won’t actually receive cash from these sales for another 30 to 45 days, at least.

To add to the challenge, growing sales means the company had to buy more raw materials than they did the first time around. Since they were selling more each month than the prior month, they needed to not only replace inventories consumed but also buy additional goods to satisfy their growing sales demand. Purchases can actually exceed sales in such a fast-growing environment.

Collections are the final step in the process. While this might seem like a minor activity in comparison to production or sales, it’s actually the most critical task in making every other step pay off. Unfortunately, it’s the step that many businesses, including Wonder Widgets, neglect-and that leads to their ultimate demise.

Don’t Give It Away

Are you starting to see how Wonder Widgets failed despite having strong profits and sales right out of the gate? Nolan Bushnell, the founder of Atari and Chuck E. Cheese Restaurants, put it this way: A sale is a gift to the customer until the money is in the bank. This final step is the one that turns the entire effort-setup, purchasing assets, hiring employees, obtaining credit, and producing and selling products-back into cash again.

At this point, the answers to some important questions will begin to surface, like: Did the company ultimately make a profit on its business activities? Did it plan adequately for the working capital it would need to finance the cash flow cycle in it’s entirety? As the Wonder Widget story makes clear, answering “yes” to just the first question isn’t enough to ensure business survival. There are three key takeaways from this story:

1. Fast growth is a double-edge sword. Fast-growing companies need more working capital than those growing more slowly or not at all. When incoming cash flow is delayed while fixed costs continue and paydays come every week, there’s a limit to how long a company can operate comfortably, even if it’s profitable.

2. Cash flow needs must be forecasted months in advance. This is especially critical during the early months of a startup. And cash flow results must be tracked separately from profits.

3. Business goes with the flow. The health of a business depends on the health of its cash flow. As Wonder Widget Co. makes clear, more businesses fail due to a lack of cash flow than a lack of profits.
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