In business, you hear the expression a lot “cash flow is key” but what does it actually mean? It is literally like the state of your wallet after a big night out. How much cash did you put in your wallet at the start of the night vs how much is left after you have partaken in a few refreshing beverages and can you afford the kebab on the way home? Business is the same. Can you afford to buy more stock after you have paid all your business expenses? So, the way cash flows into and out of your business and it's "key" because lets face it; No Mon, No Fun! There are ways to change that flow. To bring in more cash you could increase your prices, focus on profitable clients or expand your services. To bring in cash faster, you could chase debts, set up pay now services on your invoices or reduce your trading terms. To slow the outwards flow you could reduce your expenses or your stock levels or negotiate better payment terms with your suppliers. Just like the flow of water at a dam, there are levers to slow the flow. No matter how profitable your business, you need to be aware of what levers work for you. If you need help analysing your cash flow, JOG Consulting is ready to jump into action with plungers or plugs, whatever you need. Relax, we’ve got this!
