Managing Your Money

Since many CRN readers hail from the small- and midsize-business realm, I’m sure plenty of you probably hold dual roles already. There’s something to be said for managing your money more closely, rather than letting it manage you.

On May 15, we’ll publish our second special report on Profitability. This next edition will focus on sharing best practices for managing the bottom line, as well as laying out specific performance metrics for eight different technology specialties.

In preparing this project, I’ve interviewed many of your fellow solution providers about procedures they’ve put in place to optimize their profit potential. Many tactics are simple, such as requiring an up-front deposit for larger projects before the work officially starts. Or invoicing twice each month, when an implementation is scheduled to run over the course of several months.

Certainly, these sorts of things will help your own business. But they also can help your clients better manage their own IT expenditures. Indeed, if there was a common theme in my interviews, it was that the easier you make it for clients to manage their IT spending, the easier it is to manage your own cash flow.

For example, many of you tell me leasing and financing options are automatically included as part of every solution proposal because, if you think about it, many midsize companies might find more ambitious projects hard to absorb all at once. Nor may they necessarily have the budget in place in one year. Structuring such an investment as a monthly payment is often more palatable, which may be one reason the concept of managed services is particularly appealing to this segment.

For as much as they help the customer, these plans can also be a boon to the solution provider’s own financial health. Which begs the question: What are you doing to take an active role in managing your cash and credit? If you’re not hands-on, you may be hindering your ability to grow revenue and the bottom line.

Care to share any profitability parables? Contact HEATHER CLANCY, Editor at CRN, at [email protected].