Financial Analysis Can Reveal Key Insights into Your DFW Small Business
You already know that making consistently good business decisions is extremely important to your business success.
Each day, you’re looking for clues, ideas, and strategic insights that align with your company’s purpose, goals, and vision.
Have you ever thought about finding a business and financial analyst who can review your business records and reports – and interpret the numbers?
If so, you’re in luck. That’s because numbers are our specialty.
Business Success Really Is “All About the Numbers”
Excellent financial analysis – the ability to visualize, articulate, and solve complex problems and concepts – can reveal important information that can improve the chances (and magnitude) of your company’s success.
Our training and expertise – plus years of hands-on work with DFW small business owners – can help us see your company’s “big picture.” With your observations and feedback, we can quickly grasp how all the elements need to fit together.
If you decide to engage Tuscany Financial for a short or long-term project, you can count on us to provide you with an independent, unbiased approach to your business.
Our research, analysis, and interpretation of your situation can help you choose your best course of action. That’s because we’ve learned how to ignore the NOISE that can often lead the analysis process astray.
When our work is done, we can present you with potential solutions – and their likelihood of success – so you can make your key decisions with confidence.
Definitions and Examples of Financial Analysis
METHODS (EXCEL based)
- Past Performance: Across historical time periods (the most recent five years, for example)
- Current Performance: Measuring your business against the baseline of assumptions and projections (in your business plan) previously made.
- Future Performance: Use of historical data and certain mathematical and statistical techniques – including present and future values. This forecasting method is the main source of errors in financial analysis because performance doesn’t always predict future results.
- Comparative Performance: Your business compared with others in the same industry.
“What if” analysis. Once a proper financial analysis is completed, many different scenarios can be analyzed.
Common examples can include:
- How will a decrease or increase in revenue affect business?
- What is the organization’s breakeven point?
- Is it possible to take on a large client, but at a lower gross margin?
- What are the potential benefits of selling a business unit?
- Should we consider issuance of stock or a bank loan to increase its working capital?
Takes the financial statement analysis and combines the estimated data from another “opportunity.” Some examples are:
- Acquire or rent/lease certain machineries and equipment in the production of its goods.
- Make or purchase certain materials in the manufacture of its product.
- Make decisions regarding investing or lending capital.
- Purchase of another company.
- Continue or discontinue main operations or part of its business
Many components are part of the business equation; some are beyond the direct control of the entity.
Tuscany Financial can research these factors and make recommendations to mitigate any potential risks.
- Competition: Knowing who your competitors are, what they are doing, and examine points of differentiation.
- Government Regulation: Existing regulations and the climate and potential for new laws.
- Other Technologies: Is your product or service relevant to the future? Is there potential for new developments or inventions?
- Barriers to Entry and Exit of the Business: How difficult is it to enter the business, acquire a competitor, or exit by selling?
- Organizational Structure and Personnel: Is the structure of the organization consistent with the efficient execution of goals? Is there a need to reduce or increase employees and/or retrain, or combine positions?
- Buy vs. Lease: Built an Excel model to compare the “Purchase vs. Lease” of machinery for a parking lot maintenance company. (The business owner saved several thousand dollars.)
- Capital Structure: Model recommended private financing to meet the requirements of a 13-store franchise purchase.
- Financial Spreads: Built models for several companies that provided easier evaluation of financial statements. Each company could also see (on paper) how one area of their business affects another.
- Ratio Analysis: Model that allows a firm to measure itself up to a series of metrics.
- Business Valuations: Utilized fair market value of service contracts, rather than existing pricing, to help a DFW industrial supply company earn a higher business valuation.
OPERATIONAL and ADMINISTRATIVE EFFICIENCY
Financial analysis methods / procedures often include: 1) Budgeting, 2) Variance Analysis, 3) Revenue and Cost Accounting Metrics, and 4) Analysis of Profitability / Cost Structure.
Here are some recent successes for Tuscany Financial small business clients:
- Accounts Receivable Analysis: Improved cash flow and current ratio from .8 to 1.3 in one year for a parking lot maintenance company by more efficient collections and adjusting credit terms.
- Sales Operations: Increased revenue 25% year over year for a medical supply company, by adjusting compensation structure and improving performance measures.
- Financial Statement Compilation: Helped several small businesses obtain bank financing, by creating understandable financial statements from internal accounting records.
- Forecasting: Created budgets and developed realistic forecasts for several companies. Results: Improvements in business planning and management plus opportunity to obtain financing.
Don’t Leave Increased Revenue, Cost Reductions, or Increased Bottom Line Profit to Chance
If you want details about how Tuscany can help with your financial analysis needs, we invite you to visit Our Process page (in the About Us section).
FYI – For a limited time, Nick Turcsany – Tuscany Financial CEO / Small Business Consultant – is offering a “No-Cost, No-Obligation” 30-minute phone session with new Tuscany clients.
You’ll pick up some new ideas and insights during the call. If you want more details, visit the Consulting Solutions page. Or, “click” the big button below to get started.
“Great job setting up our financial accounting and reporting.”
Geoff Balkcom, Owner / GBMD Sales Group (Dallas, TX)
Here’s a partial list of advanced business and financial analysis reports and procedures that Tuscany Financial can provide DFW Small Businesses:
Advanced Budgeting/Forecasting, Advanced Variance Analysis, Advanced Investments, Advanced Financial Statement Preparation, Advanced Financial Reporting, Advanced Financial Planning, Advanced Financial Modeling, Advanced Financial Analysis, Advanced Equity Accounting, Advanced Depreciation Schedules, Advanced Consolidations, Advanced Cash Forecasting, Advanced MS Excel, Advanced QuickBooks, and more.