February 2008
February 27, 2008
The Viscious Cycle of Working Capital
Staying Within The Boundaries of The Viscious Cycle Of Working Capital is Quite Challenging
As if there aren't enough figures dancing around the left side of my
brain these days, here's another concept that I need to have a constant grasp on if I want to stay on top of my business. It's not enough to make profit; I also
have to manage our working capital. Working capital is the cash that I
must have invested in our business to operate on a day-to-day basis
Effective management of working capital is crucial to the health of any business, including my own. Taking the time to conduct regular checks on working capital is an important task to ensure a healthy balance sheet and tighter management of cash flow.Working capital is a term used to define the short-term funding required to run a business at a particular turnover level. The basic breakdown of working capital for Ocean Omega is:
Cash at bank + inventory/stock + industry/ trade debtors + prepayments + sundry receivables, less industry/ trade creditors + accruals + sundry payables.The old cliche: growth is vanity, profit is sanity, but cash is king is the moniker that I must aspire to, if Ocean Omega is to survive as a thriving small business; in a very depressed economy.To turn a profit, as a small business owner, I have to be able to identify all costs of doing business. I then have to generate more in gross profit, so after paying all overheads the business has an excess, or a net profit.
Effective working capital management requires continual review and diligence in keeping adequate stock levels in addition to ensuring that the debtor collection and creditor payment functions are optimized. If I can manage this balancing act, while growing our gross profit margin, then our business will be running at optimum performance given its current sales.
Recent world wide demand for fish oil has required us to increase the cost
of a gallon of fish oil.Our shipping costs and product costs have gone up over
100 % percent during the past several months. As a commodity , the prices of fish oil fluctuates and going forward I hope for the price to drop some?
Working capital is a mostly hidden cost of doing business, and is
misunderstood by the majority of folks in business. I will always have working capital requirements, and the only way to minimize them is to stay on top of those areas of the business that give rise to them: our credit and collection policies, and our inventory management practices.
On average, 1 to 1.5 million tons of fish oil are produced worldwide
every year. As the growth in global aquaculture pushes demand up, however,
even this considerable quantity is hardly enough. Scarcity of supply means
that the prices for fish oil continue to rise.
Value Added Services and New Product Development can be a complex conundrum, when balancing costs of goods to determine a fair and equitable pricing structure..
Therefore we will continue to explore new product expansion, keeping within the boundaries of the viscious cycle of working capital
February 21, 2008
The Slow Economy Is Choking Us Small Proprietors Too!
Once again as small business proprietors, my business partner and I are trying to formulate contingency plans of attack against ever increasing prices in freight charges, cost of goods, packaging price increases , etal.
The weak dollar and high freight prices could keep we small business
proprietors depressed in 2008. How much the system is being bled to feed the "big businesses" and "big" pharmas greed will be the ultimate deciding factor. If they go too far the rest of the system will be thrown out of
balance and it won't matter if petroleum goes up or down, unless it is a significant downward spiral in petroleum prices.
This coupled with the volatility of the world fish market, makes our job even more challenging. The most recent series of curve balls that we have incurred at Ocean Omega include, the price increase of the fish oil itself, but also the delivering freight company trying to charge us a 400% increase in its delivery charges. This freight charge scenario is totally reflective of a more prevalent instance of incompetence on the part of the internal employees of the said freight company.
Incompetence in almost EVERY customer service related position in this country is also rearing its ugly head daily. You know the drill, call up on the phone, get put on hold, get transferred to somebody that can't speak the language, listen to 1970's elevator music, get cut off- sound familiar?
In any event, after a series of tenuous attempts to resolve the overcharge on the freight charges, I think? we are now ok there? We continue to attack the price increase on the fish oil by establishing creative pricing alternatives, and looking at different packaging alternatives, which I have alluded to in several previous posts in this blog.
All the checks and balances are almost gone. Once they are the system will
self correct and those that think they are fooling folks will be in the same
boat as everyone else.
I guess we need the lesson of 1929 to be repeated, but it will make 1929
look like a small time piker in comparison when it happens.
Hang on folks this is going to be one hellava ride and it isn't going to be
fun. More taxes is just a way of saying "We can't manage our budget."
As business owners, we have to operate on a budget if we want to stay in
business. There is so much waste in state governments, not to mention the
federal folks.
One refreshing thing recently happened, a sales person from a competing fish oil supplier recently visited one of our key accounts and did nothing but trash us and bad mouth us. They stated that they just couldn't understand how we could offer our product at such competitive pricing. I perceive this as the highest form of flattery, and just in case Mr. or Mrs. Sales person, if you are reading this blog here's a couple of ways that we can offer competitive pricing.
Because we care, because we try, because our product doesn't have botlles that have pretty pictures of serene lakes with fish jumping out of them, and the bottle itself doesn't cost a fortune just to put the fish oil into it, our product has a high efficacy rate IT GIVES PROVEN RESULTS.
Oh and by the way, we are also in this business utmost and foremost to help promote good health in ALL Pets! Our driving force is not to bilk people out of their hard earned money to attain 400% profit margins!
February 16, 2008
Ocean Omega Group Purchasing Programs
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SAVE $$ ON OCEAN OMEGA PRODUCTS
Ocean Omega Group Purchase Program is a direct from Ocean Omega quantity
purchase program. With a minimum qualifying amount, it allows yourself,
family, friends and colleagues to save between 15-30% off the retail price
of Ocean Omega quality holistic healthcare products.
Ocean Omega's Group Purchase Program ~ 3 Steps To Savings
1.. The minimum opening order to participate in the OOGPP is determined by selecting
one of the three GROUP PURCHASING PLANS
2.. Contact me for further details on the OOGPP and let us know if you
require a handy OO Order Sheet email me at max1@maine.rr.com. Distribute a
Ocean Omega Group Purchase Sheet to each member of your group. Let everyone
know when their orders are due back to you, and to whom they should make any
cheques payable to, such as the coordinator of your group.
3.. Then you can place your order online at
CONTACT ME ABOUT GROUP PURCHASING! and pay by Money Order, Visa, or Mastercard.
Please note that your order will not be processed until the money order, or
cc payment is received, so please be sure that Ocean Omega receives it at
least 5 business days prior to your selected delivery date, or submit your
order via
mail if you prefer. We will send your group an order acknowledgment, when
your order arrives, please check it against the order acknowledgment to
ensure 100% accuracy.
PRIVILEGE CARD OFFER!
With your order each member of your group will receive a numbered Ocean
Omega Privilege Card. This card entitles members
( in correlation to the initial plan selected)
to a minimum of 15%, and up to a 30% savings on all orders placed through
the Group at our website
Buy Ocean Omega As A Group And Save Big!
PURCHASING PLANS.Three Options:
(1) GOLD PURCHASING PLAN
Customer must provide proof of being a member of
the OOGPP under the criteria listed above.
Annual Target Volume is $1500 per group, per calendar year. The minimum
opening order is $700 net. Continuing orders must total $500 net each.The
group meeting this criteria will receive a 30% discount
(2) SILVER PURCHASING PLAN
Customer must provide proof of being a member of
the OOGPP under the criteria listed above.
The Annual Target Volume is $1,000 per group, per calendar year. The minimum
opening order is $500 net. - Continuing orders must total $300 net each .
The group meeting this criteria will receive a 25% discount
(3) BRONZE PURCHASING PLAN
Customer must provide proof of being a member of
the OOGPP under the criteria listed above.
The Annual Target Volume is $750 per group per calendar year. The minimum
opening order is $150 net. Continuing orders must total $75 net each .
-The group meeting this criteria will receive a
15% discount
Purpose of our Ocean Omega Group Purchase Plan
Bring value to our shared customers through the establishment of a
private shopping community.
Offer competitive pricing in exchange for business volume and business
growth.
Produce strong discounts for our partner clients through the structure
of a group purchasing plan that rewards our members for the volume they
produce
If your ambitions are to utilize superlative pet healthcare products, and
ENJOY SUBSTANTIAL SAVINGS,- our Ocean Omega Savings Programs are based on
the unyielding principles of trust, interoperability, and collaborative
strength between breeder and customer and customer and supplier - Ocean
Omega offers an intelligent solution (based upon proven principles) to meet
or exceed each expectation.
February 12, 2008
Ocean Omega Offering Cost Saving Options
VOLUME SAVINGS PROGRAMS
In my last series of entries, I alluded to upcoming changes to offer cost savings options for our Ocean Omega Clients. We have literally taken a look at offering half gallon containers of our Ocean Omega Fish Oil. We will soon be replacing our 32 oz bottles, with the new half gallon size containers. We actually took an empty
gallon container and cut it in half, to do this assessment. We will be ordering new half gallon jugs soon, and upon their receipt by us, we will be pricing and adding them to our website.
In a further effort to offer additional savings options, we will soon be offering case lots of our 8 oz and 16 oz. bottles, with single and multiple case lot pricing to also soon be depicted on our website. These cases would have 12 bottles in for the 8oz and 9 bottles in for the 16 oz.The recent price increase incurred by us, will be passed on to the gallon jugs, and most probably our 5 gallon containers. Therefore, as previously promised, I am trying to find cost savings programs which will not only save dollars on the product itself, but also help diminish the ever rising shipping costs, i.e based on weight content.
We are also working on details for a "group purchasing" and "co-op" volume discount program, for such parties as , breeders, raw food diet proponents, pet advocacy groups, dog clubs, etc. We may at some point offer a close out sale on our 32 oz bottles as well I need to get with my business partner for available inventory counts. Interested Parties Should Contact Me Directly For Details! Ocean Omega Fish Oil
We are still crunching these numbers, but stay tuned as they will soon be added on our website, and I will be writing future blog updates to keep you all abreast of the progress of these changes.We are trying to continue to walk the extra mile for our clients, these are the value added features that separate us from our competition.
NEW PRODUCT COMING SOON=KELP POWDER!
February 10, 2008
Introducing Ocean Omega To Raw Diet Proponents
I recently had a nice telephone conversation with a friend, client, and fellow business associate about his connection with a local raw diet for dogs buying group. He is a member of this group, and feeds his own dog a raw diet, and he feeds his dog our Ocean Omega Fish Oil as an ingredient within the diet.
He has been kind enough to offer being a liaison to the buying groups' coordinators in assisting us to introduce our Ocean Omega Fish Oil products to the group and its members.We currently have several Ocean Omega Fish Oil clients that are proponents of the raw diet, that are indeed utilizing our Ocean Omega Fish Oil as a key component and ingredient in their own respective custom raw diets.
I would welcome the readers of this blog to contribute both their viewpoints on the raw diet, and I would be most enthused to strike a conversation with any raw diet buying group members, who may be interested in including our Ocean Omega Fish Oil into their dogs diets. Individuals who may not be members of a group are most certainly also encouraged to contact me.
I have continually written articles in this blog regarding my attempts to offer various cost savings programs for our Ocean Omega Fish Oil, and we always welcome any buying groups that may be seeking a volume discounted price program. We have had the good fortune to do a synonomous type "group purchase" program, with several of our "musher clients" that purchase our Ocean Omega Fish Oil for their sled dog teams.
Please feel free to contact me directly if you, or your buying group would be interested in exploring these types of programs.
Please visit our website for further information regarding our Ocean Omega Products!
February 07, 2008
Show Us Your Ocean Omega Pets
My last entry regarding our impending price increase has really had me somewhat distraught this entire week. I have continually tried to provide our superior quality products at competitive prices. I also have stated that I will continue to find ways to hedge these price increases with current and future savings programs.
I also thought it is time to try and have some fun, I know I get so much enjoyment from my two cats, Max and Harry (see above pictures) that I thought we should all try something to bring us out of these winter and pre-Spring doldrums, and at the same time present a way that you all can save a couple of dollars on your future purchases of Ocean Omega Fish Oil.
We Love Your Pictures and Ocean Omega Success Stories!
As we approach the second full week of February and since this month encompasses Valentines Day, the day of love and affection, we want you to show us how loving your pet can be! This month we want you to send us your four-legged companion's picture that best captures why you just can't help but LOVE your devoted friends and companions! Along with the photograph, in 100 words or less, tell us how Ocean Omega Fish Oil has changed your pet's life, why you love your pet so much, or an unforgettable experience your friend has provided for you and your family.
ORIGINAL OCEAN
OMEGA DOG
Every subsequent month we would like to be selecting our favorite photo and share their story in our next series of upcoming Ocean Omega Notes Blog entries for all to enjoy. The winning photo will also receive Ocean Omega Bucks good towards future purchases of Ocean Omega products. All entries, along with your own particulars, name address, City, State and so forth, can be submitted via email directly to me at max1@maine.rr.com. In order for entries to be considered, they must be under 5MB in size. We look forward to seeing your photos and hearing your Ocean Omega success stories!!
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