Fernando Labastida, Communications Specialist

As a CEO of a small but growing bricks and mortar company, you know how difficult it is to finance growth with bank loans these days.  And you also know that venture capital money is typically the domain of new and sexy technology companies.

But you’re growing, and you need to continue your upward trajectory. Cash is king, but it’s also scarce just when you need it most: when sales are increasing.

Well, there’s good news: you have hidden cash in your business that you don’t know about.

Ken Kaufman, CEO of CFOWise discussed how to unlock the cash and profit hidden in your financial statements in his latest interview with Anita Campbell on the Small Biz Trends radio show.

Kaufman said that most small and medium-sized businesses could free up hundreds of thousands, or even millions of dollars of cash just by knowing where to look.

Two Quick Hit Methods To Uncover Hidden Cash

Do you receive your financial statements on time? Great. You don’t read them? Not good.

Kaufman said by looking at and analyzing your financial statements, instead of your profit and loss (P&L) statements, you can can make your cash-flow explode.

Inventory

Say sales are growing by 20%, but inventory is growing by 50%. Kaufman gave the example of an actual client of his that had let their inventory grow so large that they had items sitting in a warehouse for a year or more.

That’s money that’s in your warehouse, not in your bank account.

Accounts Payable

Another CFOWise client was able to free up about $1 million by paying their vendors in 45 days instead of the strict 30 days they had adhered to before.

Only 1 vendor called the company to find out what was up. It never even appeared on the radar screens of the remaining vendors.

How To Make Sense Of Your Financial Statements

Financial statements are not exactly the easiest thing to read.

Kaufman cited the example of a CEO who admitted receiving timely financial statements monthly, but nonetheless filed it away every month because it was too much work to figure out.

That’s where a Business Intelligence tool would have come in handy.

Using a dashboard provides the advantages of looking at your data visually so you don’t have to try to decipher a financial statement.

If you use one of the standard accounting or ERP packages available for SMB companies, such as QuickBooks or Microsoft Dynamics, you can set up an automated transfer of data from there to the BI tool using a simple integration application.

Next choose the type of report you’re looking for, such as inventory or accounts payable.

The inventory dashboard can show you your 25 worst performing products, with the dollar value and days in inventory.

Talk about a sobering picture.

The accounts payable dashboard can show you a visual snapshot of your

accounts payable: vendors, due dates, how much outstanding, etc.

Now did you have to learn how to read and analyze a financial statement? No! The visual dashboard shows you everything.

Your Next Step

So there’s a little secret out there that you might not be aware of:

you don’t have to pay through the nose to get access to this kind of power and functionality.

With new software as a service (SaaS) or web-based applications, what normally used to cost 100s of thousands of dollars and long implementation times can be had for a song, and can be set to work almost immediately after signing up.

For more information on how you can identify hidden cash-flow and make it explode, click here to find out how Instant Business Intelligence from KPIOnline can help.

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