2. August, 2015

4. Big Ideas

8.  Bill our clients for what we do.  Prepare good estimates  Use our labor wisely and efficiently.  Bill clients for all legitimate time.  Bill for all out of pocket expenses.  Bill sooner.  Collect faster.

10. Account TeamsOverheadTotal Agency Revenue $ 100 $ - $ 100 Salary & Related 45 10 55 Contribution 55 (10) 45 Operating Expenses 5 15 20 Profit Before Tax $ 50 $ (25) $ 25

11.  Manage your time wisely.  Minimize the use of freelance.  Get estimates signed, obtain POs.  Bill the client for the work we do.

12. Number of billable employees100 Hours given away each week2 Total hours200 Weeks per year52 Annual hours given away 10,400 Average billing rate per hour $ 100 Value of time given away $ 1,040,000

14.  Cash flow is money collected less money paid out.  Cash flow is measured by our bank account.  Profit is revenue less expenses.  Profit is based on accrual accounting to match revenue and expenses.  You could show a profit but have negative cash flow.  Cash is what we use to pay our vendors and employees.

15.  On average we collect from clients in 45+ days.  On average we pay our vendors in 30 or less days.  We pay our employees in 15 days.

17.  We need to bill and collect out of pocket expenses up front.  This is Omnicom policy of sequential liability  Generally you can expect that we won’t cut checks until we are paid.  We should not spend out of pocket before we have client purchase orders.  If we start work before the PO is approved the client has no incentive to push for it.  We can’t bill clients without a PO.

18.  We need to bill for labor as quickly as possible.  Often we wait to bill until after the project is complete.  We can bill everyday of the month.  We can bill 100% up front.  We should not be hesitant to ask for the money.  We are not a bank and we should be paid in a timely manner.

19. Collect the money Do great work Bill the client