Keeping your Business Alive

What’s your strategy to keep cash flowing through your business?

There are two ways to improve how you manage your cash flow. The first is working capital management (managing stock, managing suppliers and debt recovery). The second, described here, is using cash flow forecasting.

High sales and consistent profits are great aspects to have in your business, but without cash rolling in regularly you won’t be able to pay your suppliers, staff, even yourself! Give yourself some security by preparing a Cash Flow Forecast for your business.

What is a Cash Flow Forecast?

A cash flow forecast is a projection of all of your income and expenses for your business over the next 12 months, with an emphasis on when the cash from the income and expenses will be received and sent. This includes when your income locked up in Debtors will be received and when your Creditors will need to be paid.

Once you prepare your 12 month cash flow forecast you will be able to spot weaknesses in the year and plan for it. By taking a proactive approach and planning ahead means you can start making changes now to help you through those tight periods, such as introduce tighter credit policies with your customers or acquire a line of credit to help you through the period in the future.

What’s even better is banks love them! Are you looking to lease some new equipment? If you are looking for finance it’s going to be easier for the banks to approve you if they can see you have capacity to make loan repayments.

Would you like security in your business this year? Are you interested in preparing your own forecasts for the year? If you would like Success Accounting Group Accountants & Advisors to prepare a 12 month cash flow forecast for your business, schedule an appointment with us today.

Remember to post down below with any questions or comments!

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