1. Money
Send to a Friend via Email

Operate and Analyze Your Business

By

Many small businesses fail because their owners don't pay enough attention to their financial management. This section is devoted to the financial management, analysis, and operations of the business firm. This includes forecasting future cash needs and operations as well as business valuation, financial ratios, employee benefits, and bankruptcy.
  1. Understanding and Preparing the Financial Statements for your Firm
  2. Financial Ratio Analysis
  3. Profitability Ratio Analysis, Calculation and Management
  4. Market Value Ratios
  1. Cash Flow Analysis
  2. Forecasting Your Future Financial Needs
  3. Employee Benefits
  4. Business Bankruptcy

Understanding and Preparing the Financial Statements for your Firm

Once you get your business set up and get a general idea of your budget, you have to learn to understand and prepare your financial statements. You will need to prepare, or have your accountant prepare, an income statement, statement of cash flows, and balance sheet. Even if your accountant actually prepares the statements, you'll do most of the work because you do the record keeping.

Financial Ratio Analysis

Financial ratio analysis is one technique of financial analysis that a small business owner can use to analyze the operations of the firm on a trend and industry basis. It's a valuable technique for small business owners to use because the ratios are relatively easy to calculate and interpret as long as the business owner has comparative data.

Profitability Ratio Analysis, Calculation and Management

Learn how to calculate, analysis, and manage your profitability from a number of different perspectives with these articles about profitability ratios and their calculation, analysis, and management.

Market Value Ratios

Market value ratios evaluate the economic status of your company in the wider marketplace. Market value ratios give management an idea of what the firm's investors think of the firm's performance and future prospects.

Cash Flow Analysis

Cash flow analysis is another type of financial analysis, in addition to financial ratio analysis, that is crucial to your business firm. You may turn a profit, but if you don't have cash coming into and out of your business, your business will fail. The material, worksheets, examples of analysis, and techniques in this section will keep you on track with your cash flow.

Forecasting Your Future Financial Needs

Forecasting the future financial needs of your small business is a difficult task. There are so many variables to take into account. You have to consider the broad economy as well as the specific industry your company is in. You have to use estimated data based on past data. Forecasting touches every aspect of your firm from managing your cash to long-term decisions such as buying plant and equipment. Here is some information to help you.

Employee Benefits

Small business owners have to deal with the issues of employee benefits for themselves and their employees. Examples are health insurance, which is undergoing a rather complex reform, and retirement benefits. In a very small business, a business owner has to allow sufficient time to decide on what benefits will be offered and study the options. In a larger small business, often there is an entire employee benefits department as the issues are complex and time-consuming and quite important.

Business Bankruptcy

If you have to take bankruptcy, or think you do, here is some information to help you. Learn about the different types of bankruptcy. See how to choose an attorney. Maybe you could use a financial workout instead of bankruptcy. Read on!

©2014 About.com. All rights reserved.