Tips for small companies to cope with cash flow (why cash flow is so important)

7 tips for small companies to cope with cash flow)
 

Why is cash flow so important?
Why cash flow is so important

Cash flow basis
Cash flow Basics

I majored in computer science and didn't have any business courses. So I want to learn what I need from my experience. the most important lesson I have learned is that the company's cash flow is the primary cause of your bankruptcy.
My university degree in computer science didn't include any business training, so I 've learned everything by trial and error. one of the biggest lessons I 've learned is this: Your company cash flow will be the first thing to put you out of business.

Simply put, the cash flow is that my bank account has enough money to cope with my daily expenses, which sounds simple? However, many people will ignore it.

Cash flow basically means "Do I have enough cash in my bank account to cover my expenses? "Sounds stupidly simple, but you 'd be surprised at how many people ignore this.

There are two reasons why it is the top killer of small companies:
So why is this the #1 killer of small businesses? Here are the two main reasons:

1. It is unrealistic to expect the company's Income and Expenditure. They often overestimate their income and underestimate their expenditure.
2. The company cannot see any shortage of funds or lack of money.

1. Companies aren't realistic when it comes to predicting their income and expenses. They overestimate their income and underestimate their expenses.

2. Companies don't see a cash transaction age coming and they run out of money

How can we do this?
What to do about it

I hope you will notice how important your cash flow is. How can you maintain a good state? My suggestions are as follows:
In order to keep track of your cash flow, you'll need a simple spreadsheet tool. My favorite is Excel.

Spend as little as possible, which is important in the company's initial start.
Spend as little as possible. This is especially important in the early days of your business.

Do not purchase hardware you do not need.
Be brutally realistic.

We need to face the cruel reality.
Chase invoices the minute they're late.

Don't ask the customer to keep you in arrears for one minute, because if one time they get the money, they will pay the other customer and then pay your fee.
Regularly update your cash flow to keep the information accurate.
Chase invoices the minute they're late. It may sound harsh, but the minute that an invoice is late, call the company and start pressuring them.

Minimize expenses.
Cut expenses as much as possible.

People usually do not pay in time, so they need to consider this factor when making a plan.
People don't always pay on time. When planning your cash flow, always account for the fact that it usually takes people longer to pay you than you think.

 

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Max (http://aboyfindyou.spaces.live.com)