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The Adjuvancy, LLC

Corporate Headquarters

Post Office  Box 25766

Alexandria, Virginia 22313

703.548.1343

2017 will be great!
A real networking and business development experience.

 

Growth is good.  Up to a point.

Issue 1:  Cash Flow:

Yes, sales are up.  Profits may even be up.  But, cash flow can be disastrous.  After all, if your gross margin is 50%, and you are growing at 30% a month, you will run out of cash in 7 months.  Don't believe it?  Consider this scenario.

You see, you don't get paid when you ship product.  Customers pay in 50 days or so.  In the meantime, you need your cash to buy your goods to make your sales, that are most profitable.  (Notice, this scenario assumes you have NO other expenses besides cost of goods- and you know that's not right.  But, with high growth, you will run out of cash.

Potential solutions:   Offer customers discounts for prompt payment (to get cash in quicker). Borrow money.   Raise capital. Slow down growth.  Factor your receivables.

 

Issue 2:  Personnel

As you grow, your will need more people to help produce, ship, market, etc.   This can become a full-time job, in and of itself.  Your executives may not be up to the task of managing this growing enterprise.  Or, maybe they can manage it, but they don't have enough time to keep the mission in focus.

Potential Solutions:  Bring in trainers to train folks to do their jobs faster and better.  Bring in a temporary CFO, COO, or CEO, to train your existing people and pick up the slack, given the high growth. 

 

Issue 3:  Logistics

Now that you are growing, where will you be keeping your raw materials, your finished goods, your semi-finished product.  how are you getting these goods to your customers?  (Do you have enough trucks?  Is your shipping area big enough to handle this larger volume?)

Potential Solutions:  Bring in a logistics expert.  Acquire more trucks.  Stagger hours, so that you can have two or three shifts working your shipping area.

 

Call 703.548.1343

 

 

Resources on our website for these issues: 

(don't forget to check our blog- there is an index to the right of the blog!)

 

Borrowing and Financing needs

 

What's in a loan proposal

 

Raising Capital

 

CXO Services

Copyright 2016 The Adjuvancy, LLC
Last modified: October 27, 2016