Vlog: Be a Revenue Center, Not a Cost Center

Vlog: Be a Revenue Center, Not a Cost Center

Your cash has value by harnessing data & technology. To look at that data and realize the additional revenue for your taxpayers or students is more important than it’s ever been! Our VP, Garrett Macdonald discusses this topic in today’s vlog.
 
There are not a lot of opportunities to increase revenues without raising taxes or tuition. Let cashvest® be one such opportunity! Start operating your finance office like a revenue center rather than a cost center.
Budgeting Interest Income for 2020

Budgeting Interest Income for 2020

It is my expectation that average earnings on short-term cash in 2020 will range between 1.50% to 2.00%.

With short-term rates currently hovering just above 2.0% and recent indications by the Federal Reserve to lower short-term rates, one would expect lower budget interest earning projections for 2020.  However, that doesn’t need to be the case.

2020 Budget Cycle

Municipal public entity and higher-ed budgeting of interest income for 2020 fiscal year is critically important.

A majority of public and higher Ed institutions continue to keep many levels of cash on the sidelines for “just-in-case” circumstances. For them, that means leaving sizable balances in low interest-bearing accounts.

Here are three steps you can take now to preserve and increase your interest income earnings for next year:

1. Perform a liquidity analysis around all your cash. This is far different from a cash-flow analysis. A liquidity analysis not only looks at the ebbs and flows of a month’s highs and lows of cash, but also includes the float of every dollar as it relates to actual daily transactions that occur all across your entity and your financial institutions . By monitoring your liquidity, the ability to pay your bills while also investing all other cash will allow you to maximize the value of all of your dollars, not just some of them.

2. Be aware that the valueof cash in the marketplace depends on the amount of time you have on your cash. Currently, money invested for 30 days is receiving higher rates than that invested for 90 days or longer. However, this can change, so having an active dialogue with your financial providers to establish an investment strategy is important. In the past eight months, there have been a couple of times we’ve seen 12-month rates jump up; they allowed those who paid attention to lock in higher rates. For your bank or investment advisor to take advantage of such opportunities relies on your ready response, always knowing what monies can be put to work, and the necessary approval processes are in place to implement upon their specific recommendations.

3. Remember that this is also good time to keep an open dialogue with your banker(s). Proactive involvement with your bank(s) will help you strategize against any reactive rate moves the bank could make in a changing rate environment.

If you don’t where to start – or don’t have the time or resources – let the team at three+one® help. With the support of our proprietary liquidity analysis and data, we can gauge critical time horizon on all your cash. That will enable you to capture the highest marketplace value for your cash and help preserve and increase your income this year and all next year.

Though it appears that rates will be slightly lower for the next budget year, that doesn’t mean you have to lower your interest-earnings outlook. It just means you need to know what tools are out there to help you make the most of  your cash on hand.

Your 2020 budget can reflect an increase in interest earnings through a proactive management style and the liquidity data of three+one®.

Prepare for Change

Prepare for Change

At recent GFOA conference, we surveyed attendees and discovered a startling disparity in the experience levels among municipal officers as 25% were comparatively new to their positions. With 50% of finance officials now age 55 or older, preparing for your entity’s leadership depth is essential.
 
In the near future the largest group of public finance officials will be new to their office. Today’s vlog introduces 5 key strategies to prepare you & your office for those changing demographics.
Anxiety + Worry = Stress

Anxiety + Worry = Stress

Do you ever enter your office to face a wall of anxiety and worry that results in unexpected stress, triggered by questions like:

How are we going to balance our budget with unexpected costs?
Are we fraudproof?
Are we getting the best rates?
Are we prepared for the annual audit?
Do we get the most out of our banking relationships?
Do we have strong liquidity just in case?
How will the public and press react?
Where can we save more money? 
Where do we find new sources of revenue? 
How do we handle all this work with less staff?

three+one Finance Liquidity AnalysisThese are just a few of the worries that go through one’s mind in a finance office that create anxiety and lead to stress – not an uncommon occurrence for those serving public entities or higher Ed institutions, especially given the lack of resources, budget pressures, and ever-increasing expectations of accountability by those they serve. 

There are some stresses that can be alleviated, however, allowing one to perform more finance functions that can actually lead to new sources of revenue.

Here are five ways to ease stresses on your staff and yourself:

1) Look to outside partners who can fill voids. Bring in additional expertise. View vendors not as an expense, but rather as cost saver or revenue-center provider.  This should not be seen as a weakness but rather a strength and a confidence builder in driving results, efficiencies, and cost savings or new revenue initiatives. 

2) Drive for greater technology, allowing enhanced productivity and filling in for lower staff levels.

3) Conduct weekly team meetings to provide transparency and allow feedback. The more involved all team members are in decision-making and projects, the greater their productivity and positive attitude.

4) Treat the public as customers by caring, listening, and striving to solve their problems. When a taxpayer walks to the counter, a positive response to your assistance will result in a positive outcome, even if a problem could not be entirely solved. Caring goes a long way and the level of tension does not escalate.  A terse exchange can make everyone’s day stressful. Statistically, one bad experience will be passed on to 25 other people, which causes major reputation risk. 

5) When vendors come knocking at the door, treat them with respect. As a public official and business owner, there have been many times I have been given a cold reception without an opportunity to even introduce myself. You never know who that person may be or whom they know. A brush-off or a disinterested attitude at the front counter can easily spread throughout the office and be interpreted as an acceptable behavior that may carry over to phone calls and emails. 

At three+one® our mission is to alleviate stress, create new sources of revenue for those you serve, while providing stronger bonds between you and your financial institutions. Through diagnostic liquidity analysis, three+one® is able to provide time-horizon data, allowing an entity to maximize marketplace value on all cash.

Just imagine creating a new revenue source without all the anxiety, worry, or stress. Now that’s something to celebrate with those in your office and with those you serve. 

Providing Solutions

Providing Solutions

At our core, three+one® is a liquidity analytics, data & tech company, and what better way to demonstrate our savvy in FinTech than to communicate with you using new media tools like vlogs? Informing the national marketplace about the value of time-horizon data and liquidity analysis will be better visualized using this new format. At three+one® we are changing the conversation on financial responsibility with this exciting new enterprise!
 
Introducing the first in an ongoing monthly series, join us for a conversation as Garrett Macdonald vlogs about the necessity of solutions-based approaches in turning your cash into your most powerful asset.