Marina Dock Age, July/August 1998

Watch Receipt and Disbursement Patterns
by Dennis P. Kissman

Does the future of your business have to be this big unknown? Most of you have heard the phrases “look into the past to predict the future” or “history always repeats itself.” Not bad phrases to remember if you are a marina owner.

Now the question is: How do you put these phrases to work for you? As a professional marina management company for absentee owners, many of whom are financial institutions with troubled properties, we have, among other things, a responsibility to make the most accurate financial projections possible. We have found that looking into past records, no matter how incomplete they may be, can tell you a lot about an operation-much more than raw numbers might suggest. As the owner or operator of a marina, you have all the knowledge you need to project into the future with a good degree of accuracy.

First of all, we need to agree that the marina industry is a cyclical business, and the primary cycle of every marina is annual. If we agree on this point, then we also need to agree that cash receipts are the basis by which we can judge the health of a marina.

I am a proponent of strong financial reporting and gathering of statistical information for comparison purposes on marinas. What I am going to suggest here is simply a technique to project how healthy your bank balance will be at the end of any given period.  

To begin the example, we need to make one other assumption. We must assume you deposited all cash received into the bank. In this example, you will be using your checkbook, but if by chance not all the cash got to the bank, you at least need to know how much was received on a daily basis and factor that amount into the example. Continue »