Conservative vs. Liberal Approach to Weight Loss

The recent budget plans and debt ceiling battle have helped sharpen the debate between conservatives and liberals who each have their own world view.  I couldn’t help but think how radically different their approach to weight loss might be.  And shouldn’t there be a better way? 

Top 10 Conservative guiding principles for weight loss 

Conservatives’ approach to weight loss 

  1. You can’t eat cake. Or ice cream. Or doughnuts.  Or anything that gives you pleasure.
  2. Abstain from alcohol and drugs.
  3. Pray before every meal
  4. No more than 1800 calories a day.  Unless, of course, you have contributed money to the Republican National Committee.
  5. Avoid fast food, or restaurants without white tablecloths.
  6. Raising exercise levels is off the table – you have to focus on cutting calories.
  7. Accept random urine tests to detect excessive carb consumption
  8. Weigh yourself once an hour and report the results to your minister or block captain
  9. If you don’t lose weight, you get put on probation.  3 strikes and you are out: you get put behind bars where your caloric intake will be strictly limited.  Unless ,of course, you have contributed money to the Republican National Committee.
  10. Other than that, do as you please, you fat slob.

 Top 10  Liberal guiding principles for weight loss

 Liberals’ approach to weight loss 

  1. Government funded yoga classes
  2. Eat 3.7 servings of fruit each day, and 9.2 servings of vegetables.  Here are the specific fruits and vegetables you are permitted to eat. (See attached table pending final tabulation of campaign contributions)
  3. Buy only organic food transported in green electric vehicles to solar powered grocery stores or wind powered farmers markets.
  4. Abstain from most alcohol and fat, red wine and brie cheese excepted.
  5. Compost your fast spoiling organic fruits and vegetables.
  6. Recycle empty food and beverage containers regardless of how far you have to drive to drop them off in the proper bin.
  7. Drink 2 gallons of filtered water a day.  Perrier, Pelegrino, and other expensive and status conferring spring waters are also permitted.
  8. Weigh yourself at most once a month.  We’re not keeping score.  It’s the effort that counts.
  9. File a class action suit to remove vending machines that sell sodas from school campuses.  Replace with fruit juices of equal or greater caloric content.
  10. Exercise your collective bargaining rights to demand arugula and alfalfa sprouts in the company cafeteria.  Stipulate organic ketchup only for the burgers and fries station.

 SurvivalWare Common Sense Approach to weight loss 

  1. Burn more calories than you consume each day
  2. Keep track so you can monitor daily progress
  3. Post your weight and performance each day on Facebook or your Blog to provide focus and motivation.
  4. Buy the SurvivalWare Diet Book (It’s only $3.99 and includes a link to a spreadsheet to help you keep track)
  5. Throw the bums out of office.  We need some common sense in our government.

SurvivalWare Common Sense Approach to Business Survival and Growth

  1. Take in more cash each (day, week, month) than you ship out
  2. Be consistently profitable.
  3. Keep close track of cash and profits so you can monitor daily / weekly / monthly progress and Never Run Out of Cash.
  4. Join a peer group or franchise system that allows you to compare your performance to industry norms, and learn about best practices.
  5. Take the time to do cash flow projections, even when it is painful to do.
  6. Buy our Software!  Take our courses!  Engage our growing army of Skilled Developers!

Cash Flow Projection Software

Doing Projections in SurvivalWare – Part 4: Working Capital

Fluctuations in Working Capital can be the source of a major disconnect between profits and cash flow.  This article covers how to analyze what has happened in the past, and how to use that knowledge to forecast Working Capital in the future.


This is part 4 of a 5 part series on how to create a cash flow projection using SurvivalWare and the generic financial model that comes with it.


  1. Getting familiar with the Forecast Tool
  2. Sales and Expenses
  3. Debt Service and Investment
  4. Working Capital
  5. Other Cash Flow


Working Capital


In this section of the model, you’ll find out just how sensitive your cash is to your ability to collect receivables and control inventory turnover.


You can forecast Accounts Receivable (A/R) based on Days Sales Outstanding, or override the forecast in any month with a dollar amount.


The same is true for Inventory and Accounts Payable.


The first step is to see how you have performed in the past.




A/R (Accounts Receivable) Days


You might see the term DSO (Days Sales Outstanding), or even Collection Period used interchangeably with A/R Days.


DSO is easy to calculate based on the A/R balance and recent sales history.  A true collection period would be very difficult because it would require an analysis of all invoiced sales and how long it took for the customers to pay.  What makes that calculation even more difficult is having to decide how to treat open invoices.  Does excluding them bias the calculation?  If you include them, what value do you assign for how long it took to collect them?  Also, do you weight them by invoice amount?


DSO is an approximation of collection period, and works well in a projection model.  Here is how the monthly DSO is calculated in SurvivalWare:


1. For each month, take the ending A/R Balance

2. Divide by average daily Sales


You compute the average daily sales based on the last 3 months of sales to smooth things out.  To do this, take the last 3 months of sales, multiply by 4 to get an annualized number,  then divide by 365 to get a daily number.


Example – numbers needed to calculate A/R Days for June:







(1) A/R Balance

Balance Sheet



  $ 45,660  

(2) Sales each Month

Income Statement



   $ 45,603

(3) Sales last 3 months

Sum of Apr, May, June



$ 111,388


(4) Annualized Sales

(3) times 4 



$ 445,552


(5) Average Daily Sales

(4) divided by 365



$   1,221


(6) A/R Days

(1) divided by (5)





This is how it is presented in SurvivalWare’s DataViewer after you do a drilldown on “Days of Sales in A/R”:



Drilldown on A/R Days

Drilldown on A/R Days






Doing a barchart showing the trend helps you figure out what a reasonable assumption for the future might be.  It looks like 35 to 40 days will be about right assuming no major changes in collection policies or the mix of customers.

Barchart of A/R Days

Barchart of A/R Days

If you have inventory in your business, you analyze days of inventory in much the same way as Days of Sales in A/R.  For a given month, you take the ending Inventory Balance.  Then divide by the daily average “Cost of Sales.” 


“Days of Expenses in A/P” is calculated in a similar fashion.  For a given month, you take the ending balance of Accounts Payable.  Then divide by daily average “Expenses.”  These expenses exclude ones that never enter the payables system, such as Payroll, Depreciation, and Amortization.  “Days of Expenses in A/P” is an approximation for how long you take to pay your vendors.  If you see the number rising, it could be a sign that cash flow is deteriorating, and you are depending on your vendors to carry you.



The reason for analyzing the three key measures of working capital in the past is to come up with reasonable estimates for these measures in the future.   The balances for A/R, Inventory, and A/P are calculated as a function of your projections for Sales, Cost of Sales, and Expenses.


Then as you change your projections for sales and expenses, the working capital balances are updated automatically.  The model needs to know how much you will have tied up in Receivables and Inventory, and how much you defer in Payables before it can figure out how much cash you will end up with for any given month.

SurvivalWare gives you the option of entering these balances directly by typing numbers into “override” cells, or by entering the number of “days” and letting the model calculate the balances.


When you enter days, this is the formula for calculating projected Accounts Receivable:


A/R Balance = Avg Daily Sales * A/R Days 


The example below shows how you can enter $50,000 as the Accounts Receivable balance in July, 2008 (“A/R Override”), and then assume 40 days of Accounts Receivable thereafter.  The model calculates the resulting balances to use in the balance sheet.

A/R assumption in the SurvivalWare grid

A/R assumption in the SurvivalWare grid