 Oxygen. Oxygen is something that we rarely think about, but without it we're going to die. And same thing with business. With business, cash and cash flow is your oxygen. Without it your business will fail. So many business owners do not understand their cash flow or cash circumstances because they do not pay attention to it. And if they don't pay attention to it, inevitably they will die. And that's the reason why we're making this video for you today. Talking about business health and how you can monitor the health of your business. Hey guys, my name is Wilson, serial entrepreneur and owner of multiple seven figure business. If you guys want to learn more about business, running a restaurant, tricks, hacks, tips, everything along the journey, make sure you subscribe along the journey because I will be sharing a lot more of these with you in our channel. If you guys haven't already watched the part one, make sure you guys check it out because I covered the first six critical vital signs of your business that you need to make sure you have clarity on in order for you to drive your business to profitability. A lot of people don't understand the business health because they don't understand what vital signs to keep track of and they just venture into the business. And unfortunately they drive themselves insane. And that's not what we want to do. We want to be able to build a thriving business, a vehicle that can give us financial and locational freedom. And that's what we're in it for. And that's why we're creating part two of business health. Let's dive right in. Additional funding. This is super important for us to understand where else can we get additional funding from, whether it be from your line of credit from your existing bank or your personal funding or your friends and family or any government grants and programs out there where you can get loans. Why is that super important? It is super important for us to identify the sources of additional funding when we need it and also how much we can get. So then that way we understand the amount of cushion that we have. The number one thing that drives businesses to the ground and through bankruptcy is because of cash flow. Without cash flow, without that just extra $10,000 that they need to flow for that just extra month, all their life's work goes down the drain. And that's the reason why before we even hit to that point we need to identify our additional funding sources and how much. The number eight point that you need to have clarity on is your inefficient assets. And what that means are assets that you can liquidate for cash, assets that are not making you any money whatsoever. For example, if you have a food truck just sitting in the back of your restaurant, you haven't used it for a year because you know what that's not the business you're in anymore, then liquidate sell that so then that way you can get your money to work for you. Identify all the inefficiencies from your business so then that way you can run a lean and mean machine that's going to generate you cash all the time. The next thing to get clarity on is your personal burn rate. This is something that rarely anyone talks about because we focus so much into our business health that we neglect our personal burn rate. We still need to have a place to live. We still need to drive a car. We still need to have our luxury goods and items. So identifying how much we spend on a monthly basis is crucial because after we identify how much we spend, we can see where we can shave off the different excess fats and then we can funnel the excess into our business when push comes to shove. Identifying our personal burn rate also allows us to be able to save more money aside from our business side of things. That is crucial for you to make sure that you have more profits in your pockets. The next point is excess fat. Make sure you identify the types of excess fat within your business. In times of crisis, in times of recessions, these are the things that are only nice to have but not a necessity for you to run your business. For example, some of the softwares out there that gives you access to millions of articles but at $100 a month, well that is considered as an excess fat. You can possibly shave that in the times of time, in the times and in tough times where you need to save money. It is super important for us to identify the excess fat. So then when the timing is there and when the timing is needed, we can cut those excess fat and run a lean machine in order for us to go through their hardship. This is super, super crucial because when we're in the works, when we're working in the business, everything becomes a necessity. We always forget about all these excess fat that we're carrying on, all these excess package that we are putting on our shoulders without understanding and really seeing whether there is a need for it or not. So identifying our excess fat would allow us to be much more efficient. The next point to identify your business health is to identify any expansion plans that you have. Whether it be thinking about a franchise, whether you'd be working on a new location, these are the times to identify your expansion plans and to perhaps, if you need to, shelf that until times are better again because you need to make sure that you have as much cash in your pocket as possible to go through potential hardships like recessions or crazy pandemics whatsoever. This is super important for us to identify. Once again, it's because we're working in the business all the time. Everything seems like it's a must. It's rare that we take ourselves out of the business and evaluate these different arms and different elements that we're working on to see whether there are a necessity, whether there are core operations or are you just working on an expansion. Nice to have a food truck that would expand your brand awareness that you're spending $30,000 on is not a necessity. That is part of an expansion and by you identifying it, you have now came to clear about where you can shave off and where you can actually shelf the project. Last but not least, you would need your summary of action plan. Now that you've identified the first 11 points of critical vital signs of your business, it is time to put them all together into a plan. Project in the next three months with all the vital signs that you have, how you're going to be able to come out above all this craziness, all this type of negativity, and all this type of burn rates. Or for example, if you know for a fact that you're going to be in the hole for more than $50,000 in the next three months, but then yet you understand where you can get the funding for it and you have a plan that after three months everything will become normal. Things would be be able to pick up again and then you would have enough time to recoup those losses and to be back into the greens again. This becomes your action plan. Now you have a plan of attack to fight the recession, to fight the poor sales and to fight the quarantine. This is super important for us to actually put everything together into a plan of your design and then you can use this plan to communicate with your partners, with your vendors, with your lenders, and most importantly with the team that you have. Whether they're laid off or whether the fact that you're going to hire them again. This gives them confidence and this becomes part of the culture that you want to create because times will be better when times are better. You need your core staff and you need that culture to be in place and this if done right and when executed right gives them so much more confidence in your ability to leave them out of the darkness. I really hope you find this video helpful for you because in times of crisis, in times of recessions it is super important for you to understand your business health. If you not understand your business health, if you don't have clarity on that then how can you expect to pull the different levers to change certain elements of your business in order for you to survive to fight another day. If you haven't already make sure you check out part one of business health right here. Otherwise I really hope you enjoyed this video because I sure did making it for you guys. Make sure you guys hit the like button if you find any value whatsoever in this video. Otherwise subscribe along the journey. I'll see you guys in the next video.