Financing Service Business

Financing Service Businesses

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Business Issue - In the U.S. economy, over 70% of national income and 80% of employment is directly attributed to the service sector. The ability to properly assess risk relative to this sector is vital for today’s commercial lending personnel.

Omega Performance’s Solution - Financing Service Businesses is a concentrated, highly interactive workshop that focuses on high-impact analysis skills and knowledge for participants at an intermediate and advanced level. Participants learn to identify the key characteristics of different types of service firms; analyze the operating cycle appropriate to different types of service firms; and classify different types of service firms based on the relative levels of labor intensity, capital intensity, and customer interaction/customization. Within the different classifications, the focus is on the relative skill levels of labor necessary, capital investment technology required, and the resulting critical management skills necessary to sustain the organization.

What Is Included

Financing Service Businesses combines classroom instruction and discussion with analysis of seven short case examples, each illustrating a different type of service business. The classroom portion focuses on:

Characteristics of service companies
Methods for classifying service companies [labor intensity (and corresponding capital intensity) versus customer interaction/customization]
Comparison of various service companies’ financial ratios
Operating cycle differences among service companies
Operating leverage differences among service companies
Understanding industry characteristics and risks of service companies
Understanding business risks of service companies
Focus on critical management areas for different types of service companies

The seven case studies each address a different set of financial analysis issues related to the service sector. The cases are designed to reinforce the concepts presented during classroom instruction and discussion. Each one challenges the participants to understand analytical approaches appropriate for different service sector characteristics.

Key learnings include:

Understanding operating leverage
Volume forecasting and managing capacity
Recruiting, training, and retaining employees
Controlling operating expenses relative to total compensation, travel, communications, and marketing
Managing the contract process to ensure successful completion of the contract

There is no pre-work required for Financing Service Businesses. Participants receive and use a Case Book in the workshop.

Delivery Options

Financing Service Businesses is a one-day workshop conducted by Omega Performance consultants.

Results You Can Expect

Financing Service Businesses helps staff:

Improve commercial credit analysis skills in a specialized market segment
Employ appropriate analytical techniques to supplement core knowledge and skills
Analyze the results of applying standard analytical techniques to a greater degree of precision
Create recommended credit facilities with more appropriate amounts and structure
Gain analytical efficiency
Improve portfolio risk

Who Should Be Trained

Financing Service Businesses is for commercial lenders, commercial loan analysts, commercial credit managers, loan administration staff, and loan review staff.

Prerequisites

Participants should have sufficient credit experience and/or have successfully completed Omega Performance’s Commercial Loans to Business or an equivalent course.