Dr. David M. Kohl

1
Great to Greater in Business Performance
Dr. David M. Kohl Professor Emeritus
Agricultural and Applied Economics Virginia
Tech Blacksburg, VA 24060 [phone] (Alicia
Morris) [phone] (Angela Meadows) e-mail
sullylab_at_vt.edu
Weekly Website Columns
Ag Globe Trotter www.farm-credit.com
Road Warrior of Agriculture
www.cornandsoybeandigest.com
2
Small Business Thinking Quotes

• 25 of small businesses filing bankruptcy just
  had their most profitable year.
• 50 of small business owners think working
  capital is the balance in the checking account.
• Checks cant be written out of profits cash is
  king!
• Funding long term acquisitions out of cash flow
  and operating monies is the kiss of financial
  death.
• 25 of small businesses dont know assets minus
  liabilities equal net worth.
• The balance sheet is the scorecard from day 1
  the income statement shows what you have done
  lately.
• Better is better before bigger is better.
• Most businesses that fail attempt to grow their
  way to profitability.
• Three uses of net profit after tax
• Reinvest in capital assets
• Pay off long term debt
• Pay dividends and take home compensation
• Using a business plan doubles the opportunities
  for profit.

3
Benefits of Vision/Mission Planning

• communications with others
• 21 more profitable
• focus on business planning growth
• 30 more profitable
• objective systematic growth
• 25 more profitable
• balance between business lifestyle

4
Business Life Cycle
Growth
Hard
Work
Creation
ComfortLiquidationorCannibali- zation
Teach Share or Destroy
of Myths
Hard Work Technician
Losers
Quit
Time
Wonder
Blunder
Thunder
Under
You go seethe lender!
The lender comesto see you!
5
Under-Capitalization

• borrowers and lenders underestimate capital and
  time requirements by at least 25
• strategy overestimate capital and time
  requirements by 25

6
Final Thoughts

• customer service starts with employee
• employee significant other/spouse
• Rule 35
• Rule 37
• APs dealing in agriculture marketplace
• Larry Bird Rule

Dr. Dave Kohls Thoughts