Is Your Leverage Creeping Up on You?


We’ve been talking about how running a business is like baking or cooking.  You need all the right ingredients, in the right proportions, cooked at the right temperature, for the right amount of time. 

Every business owner wants a business that’s perfectly “cooked”, with lots of cash flow and profits and collecting receivables well. If you want to catch up on the other “ingredients”, you can check them out here: profitabilityactivityand  liquidity

The next ingredient, leverage, is a little tricky. There are two types of leverage, financial or operating. We’re going to talk about financial leverage, which is how much debt versus equity you have in your business. Think of it like hot sauce; you don’t want too much or too little.

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Updated: Sep 4, 2021

About the author
Bill McDermott of The Profitability Coach is a member of XPX Atlanta

Business owners have a big vision for their company & want to move forward, but don’t know how. I help identify hurdles getting in the way & create a path to profitability they never thought possible.