5 Signs You’re Not Managing Your Business Cash Flow
Michele Jacques administrator Posts: 89 Silver Level Member
Worried about cash flow? Here are indications you need to make changes. SMB Compass https://bit.ly/3u8qTqB
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If you’re not managing your business cash flow, then you’re leaving a ton of cash on the table. Not only will you affect your business’s short-term profitability, but you could also hurt your cash flow in the long-term. So, what’s keeping you from managing your business’s cash flow? First, it could be that you’re not sure what your net income is. Second, it could be that you don’t know how to properly manage your company’s cash flow. Third, it could be that you don’t know where you stand financially. Fourth, it could be that you don’t know how to manage your cash flow for the future. Fifth, it could be that you don’t know how to create a cash flow statement.
The articles presents solutions that are easy to implement before reaching a downward slope. Good job! I'd also add that startups should work on finding ways to automate payments like bills and the monthly loan repayment schedules before long. This ties with the importance of bookkeeping, while also ensuring they won't miss a deadline and create new fees as a result.
Once they survive the initiation period and earn at least a handful of clients, startups should focus on having enough money saved to cover slow months or unexpected expenses. Often, this can be fixed by setting aside money each month into a savings account specifically for this purpose.
Then and only then, startups can think about outside funding. This could come in the form of a loan, a credit line, or even venture capital. So, enforcing a 6-months long battle-tested business plan can solve any prior mishaps with the cash flow management.