How Fast Can Your Company Afford to Grow ?  

Oleh:

Mullins, John W. ; Churchill, Neil C.

Jenis: Article from Bulletin/Magazine - ilmiah internasional
Dalam koleksi: Harvard Business Review bisa di lihat di link (http://web.b.ebscohost.com/ehost/command/detail?sid=f227f0b4-7315-44a4-a7f7-a7cd8cbad80b%40sessionmgr114&vid=12&hid=105&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=bth&jid=HBR) vol. 79 no. 5 (2001), page 135-167.
Topik: company; asset management; cash management; financial strategy; growth management

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Perpustakaan Pusat (Semanggi) Nomor Panggil: HH10.16 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Everyone knows that starting a business requires cash, and growing a business requires even more. But few people understand that a profitable company that tries to grow too fast can run out of cash even if its products are great successes. So a big challenge for managers of any growing concern is to strike the proper balance between consuming cash and generating it. Authors Neil Churchill and John Mullins offer a framework to help identify and manage the level of growth that a company's cash flow can support. They present a formula to calculate an organization's self-financeable growth (SFG) rate, taking into account three critical factors : a company's operating cash cycle - the amount of time the company's money is tied up in inventory and other current assets before customers pay for goods and services ; the amount of cash needed to finance each dollar of sales ; and the amount of cash generated by each dollar of sales. The authors offer a detailed hypothetical example that carefully considers these three factors ; they then illustrate how a company can influence its SFG rate by carefully managing some combination of those factors.

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