What is business Cash-flow? Simply, it is money coming in to the business, and money going out of the business. Whether you operate a convenience store or a mechanic shop, having a handle on your cash-flow is critical for every business. Proper cash-flow management is the key to any successful business!
Every business should have three months of expenses available at all times. This is especially important for any start-up business. Having a solid business plan in place, with 12 months of projected revenue, cost of goods sold, expenses, and profit is fundamental before opening the doors for business
When establishing a business bank account, request a small business line of credit, and credit card to start your business properly. This will allow you to cover any unexpected incidentals that may arise. If you are an established business of over two years, the bank can give you up to 15% of revenue, or 75% of your accounts receivable in a business line of credit.
It’s important for a business to have proper accounting software in place for their business. The accounting software will allow you to create invoices on the go, track your revenue, cost of goods, expenses, and profit. The software will track your Accounts Receivable and Accounts Payable. Quickbooks Cloud or Sage 50 are two proper accounting softwares at reasonable prices.
If you need equipment, leasing is a better option than financing equipment. The monthly expense tends to be less because you are not financing the entire amount of the equipment. Also, the lease is a full write-off expense for your business taxes.
Over the last 15 years, our sister company, Phoenix Management Group has seen many business fail because they did not properly plan their cash-flow. On the other hand, we’ve helped many business owners put in place the proper business lines of credits, loans and lease financing needed to grow their business to extreme success! Call them if you need advice.
