Profit, as defined by the rules of accounting, is simply revenue minus expenses. A positive cash flow is needed to generate profit. Usually its the sale of goods that help generate profit. New customer acquisition is essential to a growing business, but can take time and money to convert prospects into sales. Business today dont run on old technology. Foolish investing is buying into a business that has a negative cash flow, you having to take on debt, and more debt on top of it. Dont just believe if you are being told million dollar business to be. Thats what Bernie Maddoff ( Who?) told his clients. Nor would you want to buy a horse with broken legs. Not if you want that Horse to be in the lead. Dont be the investor that only has to pay but never makes a cent. If the banks wont provide the business loan why would you? So... do yourself a favor and assume you are doing an asset purchase. Dont just accept responsibility for any debts. Youre set to fail if you have to invest more than the money coming in or that youre able to make.
Posted on: Sat, 08 Mar 2014 06:50:18 +0000
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