Cash is King but it also kills. One of the companies hit the market with an IPO. Their Merchant banker advised them to raise more money than required. The issue was subscribed. Excess money they invested in unrelated business. That business could not succeed. The return on share capital could not match the market expectations. The share price reached below par. Since the share price was … Continue reading How Can Excess Cash Kill Your Business?
Mr. X, who was once a very dynamic entrepreneur engaged in the pharmaceutical business, is now under depression for many years. Family expenses and cost of two daughters’ education was borne by other close family members. His wife was doing some domestic work until both daughters completed their studies. Marriage of both the daughters was solemnized with the help of close family members. This is … Continue reading Is Your Business Suffering from Financial Cancer?
When you opt for Cake against Ice-cream, you have sacrificed the experience of eating ice cream. When you opt for Watching TV over outing, you have sacrificed an enjoyable outing experience. Every day and in several matters, we choose one over the other choice. The choice we sacrifice in favour of the choice we make is the opportunity lost. This is why it is called Opportunity cost. This is … Continue reading You Need to Know This Important Concept For Better Decision Making
Every company aspires to become like Apple. Customers shall queue outside the store before the store opens, pay a premium price, wait eagerly for the next model, spread word of mouth, the product is a prestige symbol, huge company net worth, and mega market cap. To become Apple one can’t, ignore what Steve Jobs believed and said in the following quote. Customer Experience (CX) is … Continue reading The Key to the Financial Success of Your Business
“Don’t spend Capital competing with people who are spending Profits.” Moffat Machingura The source of money you invest is very important. Do you do your business with own money or borrowed money? Well, when you started the business, whatever source the money came from was welcome. But this has an impact on your business. The capital structure simply means the sources of money a company … Continue reading You Need to Know How Capital Structure Affect Your Profit
I have seen the happiness on the faces of many entrepreneurs when I placed loan sanction letter in their hand. But loan rejection is not a happy state. Availing of loan is most business’s need for growth, especially for SMEs. There is a limit up to which promoters can invest own capital in the business. Beyond a point, they need the support of external sources … Continue reading 12 Important Reasons Your Business Loan Gets Rejected
REPO rate reduction of 0.25% is making the Indian investors excited. Investors believe this will trigger higher off-take of loans, higher economic activities. In reality, cheap money only can’t trigger more demand or higher capacity built up. There are several other factors. However, in this post, we will know about the RBI’s interest rate management. RBI manages liquidity in the market and inflation with REPO … Continue reading The Impact of REPO Rate on Your Pocket and Business