How to use financial thinking to get through enterprise management

In the economic society, enterprises are actually one of the most basic branches. As an enterprise, the problem of making money is actually the core issue. Judging from the present situation of enterprises in China, the real profit is not very good, which will also affect the sustainable development of the whole enterprise. The following is what I bring to you about how to use financial thinking to get through enterprise management knowledge. Welcome to reading.

1. Operating quality and profitability of enterprises in China

It is absolutely a very important truth for enterprises to make money, but the problem is that many enterprises do have major deviations in their ability to make money, opportunities to make money and ways to make money. Therefore, when everyone earns some speculative profits, the enterprise cannot guarantee long-term effective profits, which makes the whole enterprise lack continuity and stability in the whole operation and management.

Then the topic of profit, in reality, we will also find that there is a lack of basic research. In economics, there are two basic truths, one is the law of income and the other is the law of cost, but few people associate the law of income with the law of cost, which is the key to profit. So my basic theoretical thinking is actually based on the balance between income and cost, which is the key to corporate profitability.

Profit has become the core issue of enterprises in China. The first thing we see is that many entrepreneurs in China actually pay more attention to opportunism. For example, when they start a new industry, the gross profit margin will be high after jumping in. Everyone likes this active theory.

The more this preemption, when everyone jumps in, you don't have the preemption. The biggest problem at this time is persistence, so there is preemption, but the preemption function cannot be sustained and stable, and it becomes profit, which is really difficult to do.

A typical industry is the real estate industry. You may find that all profitable companies in China do real estate today. Real estate is actually a very typical opportunity industry. I have studied all the real estate models in the United States in the 1960s and 1970s. A century has passed, and the first 65,438+000 have basically disappeared, leaving only seven with names. What does this mean? Explain that this is an opportunistic industry. But it does not mean that opportunistic industries can't do it.

We can see that many real estate companies in China have been completely dragged down. There are nearly 70,000 real estate companies in China, which cannot be called enterprises, but only projects. After a period of time, the second project could not be connected, and the sustainable growth of this enterprise was gone. So I told Vanke a few years ago that in fact, in my eyes, there are no projects, just seeing one product after another. If the real estate company can connect the projects into a product to operate and continue to do well one by one, then it will form an enterprise. Therefore, the key to an enterprise is to be able to roll.

The second very important issue is about people's preference and plunder of resources. Many industries like to grab resources today. A few years ago, they robbed coal mines and iron mines. This is still based on demand, and sometimes it will grab a lot of resources. In fact, resources are scarce. We can see that many enterprises that do resources today are beginning to fall into pain again. We can't simply say how to make resources, but how to connect and build resources with other industries, thus becoming an overall corporate behavior. Therefore, many entrepreneurs nowadays are just one-sided elites and lack entrepreneurial spirit.

Similarly, today we see that China is short of money, and we can find that money is short. In fact, we will always encounter the problem of lack of money in the course of business. Then the money of the enterprise actually comes from three aspects:

First, in terms of profit, this is the basic source of funds for enterprises.

Second, in terms of capital, it can be said that it is listed financing.

Third, financing from debt, these means of financing, in fact, is still behind the ability to use money, this time.

You will find that behind the tight money supply is actually the inefficient use of money. Therefore, the high bad debt rate of banks is actually related to the inefficiency of many enterprises. In fact, the world is not short of money. What is lacking is good projects and good enterprises, so good enterprises and good projects, in fact, funds follow you.

But the problem is that every time the money is tightened, a number of enterprises that are eager for quick success and are heavily in debt will be eliminated quickly, and even some good enterprises will be eliminated just because they are not careful enough in capital, poor in management and inadequate in management. Today, many entrepreneurs and entrepreneurs who started from product-oriented enterprises in China are not very good at financial control. At this time, they often fall down, which is particularly prominent in Wenzhou.

The fourth aspect, I think there is a problem. Now enterprises go public, IPO, which is a good thing, can let enterprises use capital to promote faster development. But the problem is that we regard IPO as a goal.

Many companies begin to fake after listing, even without a long-term strategy, and only regard it as the follow-up behavior of listing, so you can find that the continuous quality of the company is not high after listing. I have studied GEM and SME board. After two years of listing, more than 70% of the total funds they raised were not used, so the problem came. Why did you raise so much money in the first place? This is actually fooled by the securities company. This is actually related to entrepreneurs, who are ignorant, so they regard IPO as following suit. The question is whether the profit behavior of the enterprise can be sustained after you go public. This is a big problem.

We see that there is an indicator of finance, which is called shareholder's rate of return, and profit is divided by shareholder's equity. You know, once you go public, you expand the shareholders' rights and interests, but your business depends on your net profit. So at this time, we saw the rapid growth of shareholders' equity, but the growth of net profit takes time. So generally speaking, we see that as soon as many companies go public, the return on shareholders drops sharply, and you will find that the market value begins to decline.

Many entrepreneurs can't manage the future value of their own companies, and their ability to create profits afterwards is relatively low. Profitability is relatively low, not good at managing shareholders' rights and interests. At this time, the return on capital is too low, which will eventually have an impact, and the ability of enterprises to create profits is relatively poor. We found the latest financial statement of a listed company last year from the Internet. I selected some companies in eight typical industries, such as finance, real estate, water and electricity, gas, transportation, logistics, mining, clothing manufacturing, electrical appliance manufacturing and wholesale and retail. You can find that the return rate of shareholders is actually relatively low.

There are many star enterprises, such as Bank of China and Agricultural Bank of China. You can see that the shareholder return rate of the banking industry is only a dozen.

2. Four misunderstandings in business operation

Assets ≠ wealth

The first thing to clarify is that China entrepreneurs must realize that assets are not equal to wealth. The thinking of agricultural society has a great influence on our entrepreneurs. We always think that with more assets, we will create more wealth.

You will find that closed enterprises often have a lot of useless assets. In fact, the most valuable thing for a company is its income-generating ability, because all assets of the company are ultimately costs, and costs depend on whether customers are willing to pay the bill. Therefore, having abundant assets is often a heavy burden for many enterprises now, so assets are not equal to wealth.

We often joke that we all have peasant consciousness. When a farmer has money, he owns land and houses, which makes him a kind of wealth. If you have this understanding, you will find it difficult to turn your assets into income.

Listing and development

Second, listing is not equal to development. Many entrepreneurs regard listing as a dream.

Once listed, the future development of the enterprise will lack direction. Listing is a means in the company's strategic planning. With the help of the power of listing financing and the platform of public companies, companies can enhance their competitiveness, gain brand influence, improve their governance structure and attract more talents.

The problem is that some listed companies are still mom-and-pop stores after the market ends, and the major shareholders are still in charge. They are still the chairman, general manager and chief financial officer. In fact, one person is in charge. On the surface, there are many positions, on the surface, there are shareholders' meeting, board of directors and general manager. In fact, they are all arbitrary operations. In this case, it is difficult for this enterprise to maintain sustained and stable development, especially talents.

So now we see that many entrepreneurs are busy going to the New Third Board. Note that the new third board will eventually have the profitability of the enterprise. In particular, listing is not equal to development. In fact, after listing, if you still stay at the original management level, your business cost will be higher.

Financing ≠ making money

Third, financing is not equal to making money. Maybe there are many professionals in today's class, which is easy to understand, but as we all know, many enterprises now have weak ability to realize capital and earn cash from customers. In this case, they will continue to rely on financing to obtain income. The more financing income, the more enterprises will hand over their fate to creditors. Every time the money is tightened, high-debt enterprises will fall. Therefore, excessive financing is often a faster path for enterprises to die.

Scale ≠ capacity

The fourth problem of many entrepreneurs is that scale is not equal to ability. Now many enterprises are blindly pursuing scale. As you can see, under the influence of the Internet, there are more and more small and micro enterprises. I recently did research in Jiangsu and Zhejiang provinces, and found a phenomenon that many private enterprises, especially medium-sized bosses, are dying, about 1, 200 million, or tens of millions. What should they do now? They began to contract the company to the original employees, and these employees became one person, two people, or took their families to do it themselves, and they became millions of small and micro enterprises, and the boss began to collect rent.

Therefore, this is a new phenomenon, and it is particularly easy to recruit workers in Jiangsu and Zhejiang provinces recently, so bankruptcy has become a trend. There is a big problem in this. The scale has actually expanded, but if the scale is unable to support it, it will become a burden. So a large number of enterprises are constantly split into small companies for maintenance, and these bosses have been washed away. I feel very sorry that we have seen a very serious phenomenon at this time. Many enterprises have begun to expand and become the road to death.

3. Clarify five concepts

Property; property; assets

These five concepts are familiar to us entrepreneurs or some financial personnel present here today. But I think what is more important is how to get through him and how to learn and use him flexibly. One is the assets we see. As I said just now, the cost is behind assets, so some problems should be considered when designing assets.

Assets, whether fixed assets or current assets, according to my understanding, enterprises should try their best to expand current assets, because current assets are inventories and accounts receivable, which contribute more directly to the whole operating income and reduce our fixed assets as much as possible. Today, it has become a trend to continuously purchase fixed assets in the whole country, but these fixed assets have become idle assets today, and eventually become a huge burden for enterprises.

At this time, we can find that the idle rate of fixed assets in China is too high, while the government and enterprises are desperately starting to expand fixed assets, which will eventually shift to the sunk cost of enterprises.

Sales revenue

The second issue is sales revenue. As we all know, all sales revenue is actually a combination of external and internal capabilities of enterprises. Externally, what we see is the market demand, internally, what we see is the ability to support or promote sales. So some industries, or some emerging enterprises, especially new industries, should not invest too much. I often ask people what industry you are, and you will know what your turnover should be.

Therefore, sales revenue is linked to market capacity and also related to the maturity of customers. If you still need education in this market, you will find that the cost of operating income is relatively high, and health care products are like this.

profit

The third issue is profit. As we all know, profit comes from income MINUS expenditure. At this time, you can find that the acquisition of profits has its preconditions. Your income is actually your external ability, your expenditure is your management ability, income is your management ability, and expenditure is your management ability. The difference between them is your net profit. So the level of profit depends on your income first, and then on the efficiency of your spending money. So we can see that the profits between peers will be much worse, which has nothing to do with the management behind him.

cash

The fourth problem is cash. Many of our entrepreneurs don't pay much attention to the problem of cash, that is, there is income without profit, and there is profit without cash. In fact, cash is the core issue in the daily management of enterprises, so it is necessary to control cash flow. Companies that can't control cash flow are out of control. Therefore, we need to combine cash flow with the whole business activities. Cash flow management is actually a process of enterprise management. If the management level of the enterprise is low, the cash flow will start to get out of control. Of course, there is actually a process of predicting cash flow. The worse the planning, the more cash flow will be cut off. Some people say that the interruption of cash flow is actually related to the poor planning of this enterprise. The reason for poor planning is related to the poor management of this company, and the behind of poor management is related to the backward consciousness of entrepreneurs.

Shareholders' income

Finally, what needs to be emphasized and understood is the return of shareholders. We usually talk about shareholder returns. I think the shareholder return rate of a small and medium-sized enterprise must be to earn back a company in three years, not less than 30%. In this case, if the investment is small, the profit will be great. We can see why light asset company is popular in the stock market. Shareholders' returns are very high, so shareholders' returns are very important. Let me talk about how good my business is first. In fact, you can find that what really supports the market value and stock price of this business is actually the return of shareholders, or the income of shareholders. Then, for the long-term fixed development of enterprises, in fact, the income of shareholders is often the final decisive indicator.