Last week was an incredibly week. I was a speaker at the University of East London’s Centre for Excellence in Women’s Entrepreneurship (CEWE) inaugural annual conference held on Thursday 17th November 2011 at the Honourable Artillery Company in Moorgate.

Speakers on the day were Baroness Wilcox, Parliamentary Under-Secretary for Business, Innovation and Skills (BIS), Carrie Longton, Co-Founder of Mumsnet,Wendy Hallett, Founder and Managing Director, Hallett Retail, Dr Rebecca Harding, CEO Delta Economics amongst others. I feel so honoured to have been part of this impressive conference.

Women-led businesses are normally more innovative and create more jobs than male-led businesses but unfortunately they turnover less than their male counterparts. The event sought to identify common features that women-led businesses share and provide insights to support businesses who want to grow and succeed. It did this really well by inviting all levels of entrepreneurs to share their stories.

My talk was “6 smart ways that women can create profitable and sustainable businesses”. I believe that profitability gives businesses options and should be a priority for every business owner.

As part of the presentation, there was an interactive real time quiz session during which I asked participants what the best indicator of profitability was. Their answer confirmed one of the prevailing myths about profitability, which I wanted to highlight to readers of my blog who were not able to attend the event.

The actual question was: What is the most accurate indicator that your business is doing well? 

a. Profits
b. Cash
c. Profit and cash
d. Profit and sales
Unfortunately, about half the audience thought the best answer was d. “profit and sales”. Businesses have been known to go under despite being profitable on paper and also having pending orders or sales that have already been delivered. Profit and sales are not the best indicators because:
  • You may have orders but have no cash to fullfil them
  • You may have made sales but customers may not pay on time or even at all!
  • You can be profitable but have no cash in the bank so not able to pay suppliers
  • Profit is retrospective and has little bearing on what will happen in the future e.g how you are going to pay your bills
  • Cashflow is prospective and will enable you to plan better how  you meet your committments whilst still being profitable
Together, c. “profit and cashflow” will give a a more balanced and dynamic view of how your business has done in the past and how it can continue to meet its committments and survive in the future.

I have to say the conference organizers did a great job. The event was very  informative, inspiring and motivating. I am so proud to have been part of this! I recommend that you make a point of attending conferences like this whenever you get the chance. Other than the valuable content provided, they also present a great opportunity to network with some amazing people. Two lucky subscribers from my newsletter were given the opportunity to attend as my guests for FREE.

Join our mailing list for tips on how to double your business and also win ticket to events I’ll be speaking at.

 

 

Griselda K Togobo

by Griselda K Togobo | Follow Her on Twitter Here

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