The Difference Between Sde And Ebitda

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The 3 most commonly used valuation methods are the Income, Market, & Asset approach. With the income approach, a business value is based upon the earnings the enterprise generates. Buyers are most concerned with the amount of earnings that the company produces should they acquire the business. The net ordinary income, utilized for tax reporting purposes, does not properly reflect the true earnings of the company based on the non-cash, discretionary & non-recurring items that are expensed by the business owner. Earnings are kept low to achieve the goal of reducing taxes. Therefore, to calculate the true earning capacity of the company, the P&L statements need to be adjusted during a valuation to determine SDE or EBITDA. Re-casting the financial statements will standardize (or normalize) the company earnings through the exclusion of discretionary, variable and non-recurring components, allowing an objective comparison to be made between two or more companies. By applying a multiple to the EBITDA or SDE amount, consistent with the industry sector and a weighting of the issues affecting the business, will derive the business value.

What is Sellers Discretionary Earnings (SDE)?
Sellers Discretionary Earnings is utilized for businesses with under $1mm in adjusted earnings. These businesses often have the owner managing the company and receiving a salary. With these small enterprises it is critical to determine what the owner benefit is as opposed to the earnings of the company. This is accomplished through a series of profit and loss statement adjustments termed add-backs that are made to the pre-tax company earnings. In some instances, there are negative add-backs as in the case with a business that owns real property (e.g. the building & land) where the owner is compensating himself a below market rent or a family employee working for the company who is receiving a below market salary. In both of these cases, an adjustment is made to normalize the expense to the current market value.

The most common adjustments used during the re-casting process are:
1. Add-back one owner’s total compensation
a. Salary
b. Payroll Taxes
c. Retirement Contributions e.g. 401K
d. Insurance
e. Perks (Health Club, etc)

2. Add-back interest expense

3. Add-back discretionary expenses
a. Donations
b. Personal Cell Phones
c. Travel, Meals, & Entertainment
d. Owners Vehicles (not used in business)

4. Add-back non-cash expenses
a. Depreciation
b. Amortization

5. Add-back Non-recurring expenses
a. Fines / Bank Penalties
b. Attorney fees (e.g. sale of business consultation)

6. Adjust Lease to Fair Market Value

What is Earnings Before Interest Taxes Depreciation Amortization (EBITDA)?
EBITDA is used to define the earnings of the company for businesses with adjusted income greater than $1mm. Here, the owner/investor is typically not active in the direction or daily management of the business and will hire a general manager to perform that function. Therefore, the EBITDA calculation will differ from SDE as it incorporates the general managers salary in the earnings calculation as an expense. EBITDA is a non-GAAP measure that is used to determine profitability and to make comparisons between companies and industries as it eliminates the impact of the financing and accounting decisions made. An easy way to determine EBITDA is to subtract the owners compensation and benefits from SDE. The EBITDA dollar amount will be lower than SDE but the multiple used in the valuation formula will be higher, often 2-2.5 times the SDE multiple. Therefore, as one would anticipate the FMV of the same business calculated using either method should be very close to each other. If not, an assessment as to why and which (or what other method(s)) must be undertaken.

Kpo Travel Services In India

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Knowledge process outsourcing (KPO) is a form of outsourcing, including legal process outsourcing. These are both high-value-added forms of business process outsourcing (BPO). KPO firms provide domain-based processes and business expertise, rather than just process expertise, and actually make many low level business decisions – typically those that are easily undone if they conflict with higher-level business plans.

KPO is one step ahead of Business Processing Outsourcing (BPO). BPO industry turning into Knowledge Process Outsourcing. KPO Industry handling more high skilled work than BPO Industry. KPO helps companies to create huge business opportunities. KPO firms provide domain-based processes and business expertise, rather than just process expertise. Intellectual Property Research, Pharmaceuticals Services, Medical Content & Services and Writing Services are typical KPO Services. In today’s generation KPO has lead in outsourcing business. KPO service providers also face various challenges. The Knowledge Process Outsourcing is becoming the high valuable interests of companies for their business strategies and protection. KPO services can reduce design times, manage hardware efficiently and provide research on markets thereby helping in informed-decision making.

KPO or knowledge process outsourcing can be termed as high value added forms of business process outsourcing or BPO. Unlike random customer service or handling of low end inbound and outbound calls KPO firms deliver high end domain specific processes and business expertise. It may include research and work on intellectual property, equity and finance, market analysis, database management etc. In fact on a broad sense, it can include white collar jobs from any and every industry. Be it media outsourcing, legal process outsourcing (LPO), a KPO can be set up in any near shore or offshore center on any given industry and vertical.

I have included some KPO services that are outsourcable:
*Research, Development & Analysis
*Business and Technical Analysis
*E-Learning Solutions
*Cartoon Animation & Design
*Business Management & Market Research (Qualitative and Quantitative)
*Pharmaceuticals, Biotechnology and Healthcare
*Medical Services
*Writing & Content Development
*Legal Services or Legal Process Outsourcing
*Media Outsourcing
*Intellectual Property (IP) Research
*Data Analytics
*Logistics and Data Warehousing Analysis
*Network Management
*Corporate Training & Consultancy

The major benefits of the KPO outsourcing services are described below.
*Cost reductions.
*Standard operational efficiency.
*Expert man-power.
*Time Saving.
*Profit Increments.
*Large man-power without raising costs.

How KPOs can innovate
KPOs can go a step further than standardized processes. They can define quality for highly subjective and judgmental processes (output) and create systems to check. For instance, Integreon has a concept to measure output and define efficiency: the EWU (Equivalent Work Unit). Industrializing processes will not be enough; companies must standardize complex processes to achieve scale. Complex analysis requires not just domain experience, but more importantly, domain expertise. For this, companies can provide training programs for complex skill sets and establish high professional standards. Given the regulatory-sensitive nature of the information that flows into KPOs, employee due diligence, and security and confidentiality practices should be mandatory.

Poster Templates Advantages And Disadvantages

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Using templates for poster printing is a double-edged sword. They can save you time and maybe some money, but it can also limit you creatively and make the design boring. So using a poster template should be thought of carefully. Depending on your purposes in designing posters and your budget for poster printing, using templates may be beneficial or detrimental to your project.

So here we have the advantages and disadvantages of using poster templates. Take note of these facts so that you can decide if you will use a template or hire a professional graphics designer.

Advantages

First and foremost, poster templates save you time. By using a template you don’t have to think of a specific layout or design for your color poster. All the layout decisions and design elements are already laid out for use. All you really need to do is input a few specific images and text to make the poster useful for your goal. Because of this, a poster design can be complete within a few moments. This saves you the grueling process of having to hire a professional and converse with him/her about the design.

Of course speaking of hiring a professional graphics designer, they will cost you. Designing posters digitally is no easy task. It requires training, patience and imagination. So a lot of graphic artists out there charge a significant “talent fee” for their services. The better an artist is at this, the higher the fee. Poster templates let you eliminate all this extra cost. Since most of the design elements have been thought out before no extra funds are necessary. You can either pay a small fee for the use of the template, or there are some templates out there that are free to use.

Added to this, if you are in a business that prints several kinds of posters every year or every month then a standard poster template is an economical investment since you can use the poster templates throughout the year. You do not have to create a new design over and over for each poster that needs to be printed. This saves you more money since you do not have to repeatedly hire design professionals.

Lastly, a good advantage of using a poster template is the ability to choose from a variety of designs. There are a lot of poster designs available for you to choose from. You are not limited to only one or two artists and their perspectives. When you use templates, there are a wide variety of design styles that a lot of artists have thought of that you can choose. All you have to know is what you really want to see in your poster.

Disadvantages

Now with that, there are of course also some significant disadvantages to using a poster template. One of them is the limits to creativity. When you use templates, you are stuck with the templates that are available to you. If you do not have access to a lot of color poster templates, then your choices will be considerably lacking. Also this means that you do not have much of a creative leeway in the look of your poster. If you do not have the expertise in editing a template then you will not be able to change the design elements of a poster template if you need to.

Determining Kpi Metrics For Measuring Brand Impact On Your Business

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The idea of a brand is deeply rooted in the psyche of managers as being associated with the delivery of tangible products to consumers but today we are increasingly delivering intangible services rather than goods so is branding still relevant. Traditionally a business has been viewed by senior management as split into discrete divisions, sales and marketing, production, HR, IT, legal and accounting. Some divisions created revenue and b the brand identity was important for customer recognition and action needed to be taken to maximize that while other divisions created cost that reduced the brand value and this needed to be cut. Following this methodology would logically result in increased profits.

This led in practice to highly dysfunctional decision making with, for example, IT staff being cut only for decreased effectiveness across the business producing reducing sales generation and increasing costs in other parts of the business.

Decreased profitability was the result of making otherwise perfectly logical business decisions based on KPI metrics.

The Balanced Business Scorecard seeks to address this dysfunctional approach to business management and looks at how the entire business operates as a cohesive, holistic whole. Viewing all divisions of the business as creating value allows for logical rational business decisions that do lead to increased shareholder value and enhanced profitability.

Is measuring traditional brand metrics still relevant?

The blunt answer is yes, the company brand is perhaps more important than it ever has been but how the brand is being used has probably altered greatly as is how the value of a brand is perceived not just by customers but also by shareholders.

For many listed companies the value ascribed to the company brand accounts for more than a third of the company share value. In many instances, brand value accounts for far more than that. The issue is how do we measure brand value and what metrics are available for us to use as part of a Brand KPI tool.

Using financial metrics for brand performance measurement you will find the following as the primary metrics to monitor and analyze:

– Sales Generation – measures brand as a factor in the purchasing decision
– ROI – measures the ROI using the accounting goodwill value and treating it as any other balance sheet asset
– Transaction Value – looks at the contribution from product lines and product mix and the impact of the brand on that contribution
– Growth Sustainability -this is a measure of how much the brand is contributing to sales rate growth without the business introducing further investment to gain that market share.

Financial value is probably the simplest metric to determine as we can extrapolate “goodwill” valuations using accounting and financial data coupled with share price information. At least with share pricing information we have a set finite value that the market is placing on our business and the financial accounting information can give us a basis for determining how much of the price the market will pay for a share is determined by the valuation of the goodwill.

Measuring brand perception and performance is trickier as we dealing with nebulous concepts that we know have an impact but cannot directly measure. Performing customer awareness surveys will help in providing a measure of how well known the brand is with consumers in a given section of the population or target market segment. All of these can be measured but the metrics that are produced are based upon subjective questioning and even more subjective answers.

Tips on Real Estate Flyers

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Real estate flyers still have a way of reaching out to more customers. But these days, there are more ways than one to handing them out. You don’t have to stick with literally handing out these flyers from among people who pass by you. You can also take advantage of online methods when it comes to handing out your real estate flyers.

But first things first, you need to plan ahead before making the said materials. It all starts with creating your objectives. Make sure you identify who your intended recipients are. It would be best to profile them based on demographics so you can have a clearer picture of who these people should be. Creating objectives would also allow you to think about what your own business goals are.

When you already have your objectives set, it would be easier for you to create your message. Your flyers must be able to speak to your target customers in such a way that it would generate a response as well. To do this, it would become important to profile your target market so that you would know how it would be best to approach them.

Aside from the message, you should also plan the images you would place on the flyers. It would be best to use actual images of you, your colleagues, and the property you have sold or currently selling. At least your recipients would know that you mean business and this would also allow recipients to already develop an interest about the properties you currently sell.

While you may have initially developed your message, it can be a different experience when already creating your copy. It helps to pre-identify keywords that your copy ought to have so that it would be easier for you to figure out how best to speak with your target clients and current customers.

Finally, your flyers shouldn’t be sent out to people without contact information. That would totally defeat its purpose. Make sure that you have included all the professional contact information you have and double check if they have been updated.

When using traditional channels for your real estate flyers, make sure you choose a venue where your target market can be found. You should also take advantage of events wherein your target market is likely to attend.

And of course, take advantage of online distributions as well. This is where having a website becomes essential because you can use opt-in lists or email marketing to send out your real estate flyers.