"Getting a Grip on Your Business' Financial Health" "Business Banking in Israel" Slides from my Nefesh Presentation on Feb 22 to small business owners and the self-employed. Visit my site for more information and tools. Credits: Peter Baelish art from AimeeZhou.tumblr.com Client mapping tool use: Bubbl.us

1. Getting a Grip on your
Business’ Financial Heath
Shuey Fogel

2. Shuey Fogel
Principal, Fogel CFO & Management Services
Husband & Father of 5
Lower East Side  Jerusalem  Elazar
Public Service & Nonprofits
Israel Banking Sector
Department Mngr, Banking Solutions for
Businesses & Nonprofits
NonprofitBanker: Online Resource for Israel’s
Global Nonprofit Sector
Former Chairman & Treasurer of Town Council

3. Shuey Fogel
Principal, Fogel CFO & Management Services
Outsourced CFO/Controller:
• Internal Fiscal Direction & Management
• External Financial Communication
• Satellite Office Services
• Banking & Credit
• Consulting Projects
• No-Kickback Referrals

4. Do I need a long term plan?
I don’t know the answers.
Do I even know the questions?
What tools are at my disposal?
Whom can I trust?
Our Business’ Health

5. Uncertainty + Annoyance

6. Agenda
Define Terms
Introduce Key Concepts
Tools & Best Practices
Practical Applications

7. Defining Terms
• Income = Billing = Payments from Clients
• Profit = Income - Expenses
• Fixed Costs = Constant
• Variable Costs = Changing

8. BUDGET Tool
Means to an End
The What ≠ The How
Be Conservative
≠ Reimbursables

9. BUDGET The Dream

10. CASH FLOW Reality

11. Defining Terms
• Working Capital = Available Cash
= Net Liquid Assets
= Current Liabilities - Assets

12. CASH FLOW Bank Account
The How ≠ The What
Reimbursables
VAT
Destroyer of
Companies & Countries

13. TIP #5
When creating
spreadsheets, enter data
only once to avoid
inconsistency.
Fact of Life:
Owners Get Paid Last

14. TIP #1
Simplify life by
consolidating payment
dates.
Paying by credit
card can help.

15. TIP #2
Choose a credit card
payment date that
matches client payments.
Otherwise, the
calendar month.

16. TIP #3
In the early life of a
company, cash flow might
be more important than
saving money.

17. TIP #4
When creating
spreadsheets, enter data
only once to avoid
inconsistency.

18. ONE WORKSHEET:
Budget
Billing
Cash Flow

19. Financial Theory
of Relativity:

20. Cash flow problems
can become budget
problems when:
1. Increased interest
expenses related
to credit.
2. Greater income
needed to cover
cash flow issues.

21. CLIENT ACQUISITION COSTS
Time & Money
Increase existing clients
Axiom: “Losing 1
unsatisfied customer =
40 new clients”

22. FINANCIAL GOAL SETTING
Planning
When to change the
status quo?
Were original estimates
correct?

23. Defining Terms
• Liabilities = Payments for past expenses
• Assets = Resource with economic value
• Solvent = Assets > Liabilities

24. LIABILITIES: AM I SOLVENT?
Liabilities
Outstanding checks
Upcoming payments
Loan Payments
Assets
Checks in-hand
Cash
Credit Line
PayPal/Credit Card

25. COST OF TIME Client Work
BizDev
Administration
Shmoozing
Education &
Development

26. PRICING Your Time
Product
Top Down (Salary/Time)
Bottom Up (Product)
Payment Dates

27. CLIENT NET WORTH
Income
Referrals
Additional Value
• Timely Payments
• Reputation
• Volume
• Quality of your Work

28. Calculating
Client Net Worth
• Analyze both past and present clients
• Create common denominators
• Convert these commonalities into services, products,
or modules
• Assign income and expenses
• Map clientele
• Divide income according to mapping

29. FROM THEORY TO PRACTICE:
Client Net Worth:
Client Mapping

30. STAFF Two Kinds:
1. Salaried
2. Outsourced

31. STAFF
Salaried
Pull in 120%
Pay by the 10th
Mandatory benefits
According to law
Outsourced
Per cost
According to contract
VAT
Per month/contract
Quality & Ownership

32. CREDIT Do I have a Cash Flow
problem or a Budget
problem?

33. CREDIT: LINE OF CREDIT
Cash Flow Challenges
Discrepancy btwn
income and expenses
Ongoing, occasionally
used

34. CREDIT: LOANS
Invest ≠ Pay Yourself
Refinance Credit
Personal or Business
Home Equity
(Protect Yourself)

35. GROWTH Growing our biz to:
• Increase profit
• Increase quality of life
Funding growth with:
• Surplus
• Credit

36. • Budget
• Cash Flow
• Client Acquisition
Costs
• Financial Goal Setting
• Liabilities
• Cost of Time
• Pricing
• Client Net Worth
• Staff
• Credit
• Growth
Topics Covered

37. Making Business Banking
in Israel Work for You
Shuey Fogel

38. Israeli Banking Today:
• New technology
• Rotating managers
• Increased regulations
• American (IRS) Invasion
Accept the possibility of switching banks
every 3 to 5 years.

39. When it comes to service,
there are no good banks,
only good branches.

40. DIGITAL SERVICES
Check Deposits
Shekel Wires
F/C Conversions
“Super” Branch
Online Tellers

41. Don’t use your brain when navigating
bureaucracy.
Just do what they tell you.

42. ACCOUNT NAMES
Will mirror company or
charity name.
Individuals can use DBA
(Doing Business As) name.
Incoming checks & wires
need to match too.

43. FEE TRACKS The Great Equalizer

44. FEE TRACKS Basic = ‫בסיסי‬
10 Automatic ‫ישיר‬
1 Clerk ‫פקיד‬
Expanded = ‫מורחב‬
50 Automatic ‫ישיר‬
10 Clerk

45. FEE TRACKS Defined as Small
Business ‫קטן‬ ‫עסק‬
First Year or under 5
million shekels
annually

46. MULTIPLE ACCOUNTS
Optional: separate
accounts for
independent projects.
Banks may not name
other accounts as
you wish.

47. INTERNATIONAL TRANSFERS
Banks
Exchange Brokers
Peer-to-Peer
Peer-to-Peer in Israel
is less popular &
perhaps not needed

48. “It's easy to get a loan
unless you need it.”
- Norman Ralph
Augustine

49. CREDIT Types:
Loan
Line of Credit
Credit Cards
(Checks)

50. CREDIT Loan = ‫הלוואה‬
Lower Interest
Full amount up front
Line of Credit
Higher Interest
Use as Needed

51. CREDIT Banks treat all credit
as the same.
Approved one
amount, broken up
as you wish (kind of).
Use/change to your
advantage.

52. CREDIT CARDS
Most issued directly
from your bank.
Need to provide
collateral.
Exception for small
amounts.

53. Choosing the right bank for
my business:
• Service
• Online capabilities
• Credit
• Not about the money

54. Thank you
Shuey Fogel
Outsourced CFO/Controller
Internal Fiscal Direction/Management &
External Financial Communication
shuey@fogelcfo.com
fogelCFO.com
@fogelCFO
/shueyfogel