Healthy Cash Flow Strategies For Your Small Business

I‘m always on the lookout for articles with the potential to positively change a business. What’s your take on the following points I came across recently?

ou’ve probably heard the saying, “Cash is King,” – and truly, a healthy Cashflow is a vital part of any successful business. Net income doesn’t pay the bills and neither do the assets or equity in your business. Only cash pays the bills.

Without a doubt, proper Cashflow management in your business is critical to its growth and longevity. Understanding basic Cashflow principles is the first step in effectively managing your Cashflow.

Cashflow is more than just a fancy term. In its simplest form, Cashflow is the movement of money in and out of your business. It can be described as the process in which your business uses cash to generate goods or services for sale to your customers, then collects that cash from each sale and completes the cycle all over again.

Let’s look at each flow of cash:

Inflows:  Inflows are the movement of money into your cash flow. Inflows most likely come from the sale of your goods or services to your customers. If you extend credit to your customers and allow them to charge the sale of the goods or services to their account, then an inflow occurs as you collect on the customer’s account. The proceeds from a bank loan, money received from investors or sale of assets are also cash inflows.

I’d be really interested to know your opinion. Check out the full article HERE and then I’d be happy to discuss with you by phone (0411) 787-435 or email [email protected].

Thanks,

Patrick