5 Business Management Model Tools

Over the past 20 years in my consulting practice, I've developed a number of models that help me quickly assess business situations. Some of the bests for small business are attached and offered free for your personal use; however, please do not sell the attachment or use it as a premium without checking with me in advance for permission.

The attached models are good for determining:

1. After-tax weighted average cost of capital 

• When to use: To determine the minumim acceptable rate of earnings on capital investments (e.g., investments in equipment, etc.)


• Referencing question: If I buy the new piece of equipment on credit, what is the "real" interest rate I'm paying after taxes?

2. Future Value of Capital Investment

• When to use: To determine the future value of a capitol investment.


• Referencing question: If I buy one new piece of equipment on credit, how much will I have to make with it in the next 12 months to "pay it off"?

3.  Turn-Around Model

• When to use: To create "what if" scenarios to turn around a loss.


• Referencing question: I'm losing money on a product.  How can I turn it around?

4.  Residual Value of a Customer

• When to use: When you need to know the value of a customer.


• Referencing question: What is a customer worth to my business?

5.  Online Feasability Assessment

• When to use: To determine if it makes sense to sell your products online.


• Referencing question: Would my products sell well online?

Let me know your thoughts on these by posting to the comments.

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