Description
The basic output of doing Part 1 is to have a good understanding of the unforgiving first rule of survival and why adherence to this rule is so important to the survival of the business overall. It illustrates why many businesses fail, not only in their infancy during the start-up processes, but also once they have become mature businesses.
This insight is obtained by breaking down the basic Logic models into the simplest form and starting with the cash conversion cycle of the most basic form of business. Each of the basic elements are then introduced culminating in the working capital model and the inherent risks of these elements are discussed. Basic survival ratios are also introduced.
At the end of the section a good mind map would have been formed, which will aid and guide daily business decisions ensuring that the most important survival ratios are adhered to when making these decisions.