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How Strategic Marketing Management Can Turn Cash Starved Companies Into Cash Rich Entities?

Given the volatility of the market and the poor liquidity conditions, several countries in Europe, sections of industry and millions of consumers are considered ‘risky bets’ by lenders. They may boast of high turnover and profitability, but may be starving for cash and living hand to mouth.

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How Strategic Marketing Management Can Turn Cash Starved Companies Into Cash Rich Entities?

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  1. How Strategic Marketing Management Can Turn Cash Starved Companies Into Cash Rich Entities?

  2. Management Consulting Firms in India We love to talk about things we feel most comfortable talking about. Ask anyone how they are doing and they will often tell you what they are very happy to tell you, not necessarily what may be important to know. Social conversations are about putting people’s mind at ease and building the rapport that is so essential to remain mutually likeable. However strategic marketing management demands surfacing some inconvenient truths. 

  3. Given the volatility of the market and the poor liquidity conditions, several countries in Europe, sections of industry and millions of consumers are considered ‘risky bets’ by lenders. They may boast of high turnover and profitability, but may be starving for cash and living hand to mouth. 

  4. Cash is market power and a cash based marketing can influence our business confidence; help us borrow on terms we need to borrow and not on the terms others may be willing to lend us. No matter how uncertain the future may seem nor how mature the industry, cash rich companies keep the wheels of business turning to be everlasting.

  5. If we believe that business is a game of chance, we may borrow at will and walk out when  the situation turns unfavourable. Instead of worrying about compounding the earnings quickly, regrettably, we spend more time and money on getting the accounts right. Daily cash flow is the pulse of the business, but more time is spent on finding innovative ways to get subsidies and concessions. Consequently instead of managing our cash intelligently, we are content to maintain our books diligently.

  6. On the contrary, if we conduct the busies with an ‘ownership mindset’, we may approve of the strategic marketing plan only after reassuring ourselves that it can deliver accelerated rate of cash inflow. When the strategic intent of the business is clearly articulated in terms of the rate of cash flow acceleration demanded, the go to market strategy may be less academic and more businesslike.

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  8. Strategic Marketing Management For example, if one were to simultaneously expand the market size and deepen their presence in a cash rich market segment, the strategy would focus on the ways to carve out a unique identity and lock out imitations. Sacrifice the temptation to generate revenue from cash starved customers and deepen the prospects for repeat sales and referrals from a smaller base of loyal customers, instead. Assured cash inflows means learning to earn at a faster rate than the rate of increase in input costs. That makes immense strategic business sense, especially in times of looming uncertainty.

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  10. How to detect the signals in a strategic marketing plan that will accelerate cash flow?  A faulty marketing plan will have expenses riding far ahead of income, sell more on credit and less on cash and keep borrowing at a faster rate to post higher revenues but get more risky.  The acid test for a good plan is its ability to deliver more with less cash. Such companies generate higher premiums, collect more cash by end of day and borrows less and less. Gains are tangible,  measurable and sustainable.

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  12. Contact Shekarsan thought catalyst, executive coach and management consultant. Shekarsan can be reached at shekar@shekarsan.com or by phone at 91 44 4350 2000 Or mail using the contact page in www.shekarsan.com   About Shekarsan LLP: Shekar aims to promote strategic thinking and viable execution, for Multinational companies and owner promoted, family owned small and medium enterprises. Shekar is a transformational thinker and avid advocate of ‘Customer Centricity’ that he championed as a Director for Xerox, GE Capital and Citibank.

  13. Contact Person: Shekar Rangarajan • Business Address: 3A, Prasantham,141, St. Mary's road, Alwarpet, Chennai, Tamil Nadu - 600018, India. • Business Phone : +91 9884074802Business Email : rshekar@mac.com • Business Website: http://www.shekarsan.com/

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