Category Archives: Business Reports

By Patrick Farrelly

You are evaluating a target company that had higher than normal revenue growth in 2020. The target company presents you with a five-year forecast that maintains the above average growth experienced in 2020.

Is the target company’s spike in growth a one-time outlier event or is the growth sustainable? This is a common question many private equity firms currently face following a volatile 2020 business environment.

The answer to this question is critically important since it impacts the target company’s valuation and your firm’s return on investment.

The prior example highlights the importance of the buy-side due diligence process given the uncertainties in today’s market. In the past, your firm may have engaged a third party for only financial due diligence (or quality of earnings – Q of E). However, complementing your financial due diligence with commercial due diligence can help mitigate deal risk, increase return on investment, and improve deal structure and price.

What is commercial due diligence?

The goal of commercial due diligence is to assess the growth and profitability potential of your target company. Target companies’ future financial forecasts often project high growth and profitability over the buyer’s planned holding period. Commercial due diligence helps to validate the assumptions driving your target’s financial forecast.

By Rick Schwerd

There’s a lot of talk about inflation, but truly understanding its impact can help you plan for the long term. Let’s take a closer look. 

What is inflation?

Going back to basics, inflation is the increase in the average cost of goods and services over time. We see this at play in our daily lives. The cost of a loaf of bread in 1990 was 75 cents, $1.99 in 2000 and $2.99 in 2010. Inflation can be a positive or a negative. We all like to see inflation in our wages. It’s a different story at the gas pump or with our grocery bill.

Fast-rising inflation, or hyperinflation, can devastate an economy as money becomes less valuable, goods are hoarded or become scarce, and demand escalates prices. On the other hand, deflation is also a negative, as consumers are rewarded with lower prices for delaying purchases. Consumer demand drops and economic activity falls, creating a harmful downward spiral.

How is inflation measured?

The Consumer Price Index (CPI) is the most common measurement of inflation. Compiled by the Bureau of Labor Statistics, CPI tracks the change in the cost of consumer goods and services, such as vehicles, food and housing. One of the Federal Reserve’s mandates is to maintain stable prices. This has been defined as an average inflation rate of 2 percent annually.

How does inflation affect your savings and investments?

By Wendy Waldron

As we build the new normal and reconstruct our economy, let’s take a moment to get back to the basics. Whether you are an owner, foreman, manager or director, there are three things that every leader needs to be doing to make the most of every day. Bring the ABCs to the jobsite.

A – Avoid Busy-ness.

“Quick, look busy, here comes the boss.” It’s so classic it’s almost a cartoon, and yet most of us fall into this trap of “busy-ness” on a regular basis. Is it enough to “keep the guys working?” Well, are they doing profitable work? What do you really know about an office worker’s “production” by walking by their desk? When so many switched to work from home, did you lose a sense of knowing what they were doing?

Do you know what drives the profit in your business? What key activities should be done each week and who is responsible for accomplishing those actions?

You need information now, not at the end of the quarter. Maintain a weekly scorecard listing the priority activities, the goal, and who is responsible for making them happen.

B – Boss Mode.

You are not leading a social group or choosing a restaurant for dinner. It’s important to make your expectations known. Imagine that you are coaching a basketball team. It’s your job to clarify the rules of the game. Do you really want all of the players running together in a pack playing offense and defense simultaneously? How can your team deliver if they don’t know exactly what’s expected?

By Brian M. Johnson

When it comes to where and how you live, and what you do with your money, you want the freedom of choice and confidence that you’re making the right decisions. The same is true with your long-term care strategy, helping you set the stage for the future and legacy you have planned.

Long-term care is quite simply assistance with simple everyday tasks, even as simple as eating or getting dressed. The need for care could arise from an accident, illness, cognitive impairment or the aging process.  You may never need it.  But, the best time to start thinking about it is before the need arises and while you’re still able to take control. 

Many Americans work hard, save diligently for retirement, yet fail to address the single biggest risk to their portfolio and families: extended healthcare. 

When it comes to long-term care, do not be swayed by common misconceptions such as:

“It won’t happen to me.”

People unrealistically downplay their personal risk. SOme 79 percent of people put off discussions about long-term care, but 98 percent of financial professionals say they have clients who have needed it.  In fact, being healthy presents even a higher risk of needing long-term care services than someone who is managing chronic a condition.

By Dorothy Rogers-Bullis

As New York state begins to look toward a post-COVID-19 reopening strategy, many businesses, organizations, and schools are trying to reinvent or re-imagine how they will safely operate. And it won’t be business as usual for most.

Each individual organization will need a thoughtful and highly customized approach, taking into account their business objectives, their space, and their employees’ work styles, while also creating appropriate social distance.

Here are some of our top tips for organizations as they explore their reopening options.

Create a committee. It’s going to take buy-in from numerous people in order to approve and implement a workable reopening plan. Your return-to-work steering committee should include leaders from HR, communications, and facilities, plus employee representatives. You’ll need their help with brainstorming ideas and managing expectations, as well as modeling positive behaviors.

Communicate. Input from employees is important, but it’s also crucial to keep people informed about what you are doing to ensure their safety. Keeping the lines of communication open is so important. If you are honest and upfront with staff and customers, encouraging people to ask questions and share their concerns, you will be able to gain their trust much faster.

By Michael Cruz

As we get ready to re-emerge, it is important for you to re-assess your business. The entrepreneur’s mindset is to set to succeed. As the world throws you obstacles, you always find ways to overcome them.

Well, we have been thrown a big obstacle. What will you do? If you have not already, reach out to your best customers. Check in. See how they are doing. Even if they are shut down, this will be appreciated.

This will also help with your relationship when everyone is ready to fully engage. It is important to re-examine all aspects of your business. What you were doing before COVID-19 is not necessarily what you should do next. Examine your business plan. I often say that a plan is like a road map.

The only time you don’t need a map is when you are going where you have already been. Or – when you don’t care where you are going. Things are not going to be the same for quite a while. Your customers are having the same challenges you are. Everyone will be a little more cautious as to where they spend their money.

That is the mantra by which we find ourselves involved with the nonprofit community. Whether you are working at one or on the board for one, it was a heart tug that got you there. Nonprofits get special IRS treatment because they perform a public good. They need a clear purpose focused on why the community is better because of their work.
Yet, they are still businesses. And they have to behave as one. That means having a sense of purpose. It means knowing that the model needs revenue to allow for the expenses of delivering the service. And, most important, they need more revenue than they spend. As simple and obvious as that sounds, passion will often overrule common sense. It’s where Boards come in.
As part of the legal structure they are the governing body. Boards act as stewards of the public trust. They ensure that these organizations are operating legally and ethically. They also provide the direction to make sure the nonprofit is answering community need. And that they are changing to meet new needs as they change. In addition to providing that direction, the Board is charged with providing the resources to help meet the mission.