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Making The Right Money Business Articles | September 10, 2010
While having lunch with a client, he asked me a question ?Why don?t most small business owners make the right money?? ?Having owned a few small businesses myself, and while consulting to owners and or...


While having lunch with a client, he asked me a question ?Why don?t most small business owners make the right money?? ?Having owned a few small businesses myself Cheap Jared McCann Jersey , and while consulting to owners and organizations in over 20 different industries, I believe I could and did answer his question.? And, I would now like to share my answer with you.


Although there can be a plethora of reasons for a weak return, I have narrowed this rationale to 5 decisive factors that I have personally witnessed, that hinder the attainment of significant financial return.? I would also suggest that even the client organizations that have Cheap Jamie McGinn Jersey , in the owners view, provided substantial return; I have discovered as much as 4 points being left on the table.


But, before I reveal those 5 primary factors, let?s describe what real financial return means. ?Real financial return is when ownership has W-2 compensation that is above the market for comparable employment plus an above market return on any investment in the business.? This is computed over no less than 3 fiscal years and no more that 5 fiscal years, ongoing.? A great methodology for this measurement is the MAT (Moving Annual Total) calculation.? With an established variable base line Cheap Radim Vrbata Jersey , you will always know when you have fallen below market or are reaping above market returns.


Why above market?? Well, if your wages are at or lower than analogous employment and your investment would throw off an equivalent market return, why own the business, given the considerable risk, headaches and legal exposure?


Only the W-2 compensation depends on the company size Cheap James Reimer Jersey , industry, etc.? A profit distribution or stock dividend, which is also expected, is not (by percentage) dependent upon the company size, industry Cheap Nick Bjugstad Jersey , etc.? If it were, there could always be some justification for an inadequate return.