Finding the Perfect Cash Benchmark for Your Business

What is a Cash Benchmark? Cash benchmark is a unique metric because it represents a sweet spot. It helps business owners determine the ideal amount of cash they should have on hand to manage risk without leaving too much cash idle, which could be better used elsewhere. The key question it answers is: How much money […]

Debt to Capital Ratio Explained

What is Debt to Capital? Debt to Capital is a financial metric that shows how much of your business’s capital structure is funded by debt relative to equity. It helps you understand how reliant your business is on debt to finance its operations and assets. Understanding the components of debt to capital: Together, debt and […]

Understanding Free Cash Flow

The Importance of Free Cash Flow In business finance, there is one concept that often stands far above the rest: free cash flow. While many focus on profits, the reality is, as I often say, “You can’t eat profits.”. What actually sustains and grows businesses is the available cash after operations and necessary investments – […]

A Simple Guide to Contribution Margin

  What is Contribution Margin? Contribution margin is an accounting calculation that tells you how a particular product contributes to the overall profit of a business. It’s measured by the money left over from sales revenue after paying all variable expenses associated with producing a product.