What is it?
First thing’s first, what exactly is it? Put plainly, cash flow management is the act of ensuring the amount of money coming into your business is greater than the amount going out.
Sounds simple enough, right?
Well, the statistics suggest otherwise. With cash flow being the prime reason for 82% of start-up failures in 2019, it’s very clear that successful cash flow management is a skill that’s not only handy, but entirely necessary for survival.
Why is it so important?
Cash flow is a crucial thing to have a firm handle of because it provides an unbiased, true reflection of how your business is doing. As money starts rolling in, many get distracted by the successes and in doing so, get their eye off the ball and end up in trouble. Knowing exactly what’s going in and out means you can project a forecast, which then allows you to plan for your future and work to minimise risks - giving you the best chance of success.
How can you successfully manage cash flow?
Now we get to the good bit, what can you do to become a cash flow management master? We’ll go through the initial checklist of how to successfully do this below.
Punctuality is the politeness of kings
...and a really important part of cash flow management! For example, by submitting invoices swiftly, you’ll ensure a prompt turnaround which results in an easy to follow timeline of payments.
There are several ways to keep on top of time frames with ease, such as online accounting software, allowing you to be a cash flow master without losing time.
Fast is fine, but accuracy is everything
It’s all well and good to ensure you’re on top of your deadlines, but without prioritising this alongside accuracy, you’ll find yourself getting in a muddle. Half of the problems with cash flow and late payments come from delays as a result of mistakes and correspondence - don’t let this be your downfall.
A fantastic way to keep things simple and avoid mistakes, is to operate through software integration. Picture this - all your financial apps integrated so that you can easily access the information you need - doesn’t that sound lovely?
To be a mighty manager, you need to monitor
So, you’re punctual with our deadlines and accurate with everything on your end, the next step is to monitor. Ensure that there are no nasty surprises, by actively monitoring payments so that any issues that arise can be nipped in the bud before they grow into something more problematic.
We don’t want you to be afraid of your finances. By working with us, we’ll help you build confidence around your numbers, with a financial expert who’s committed to your success, and will get in touch if anything out of the ordinary pops up in your accounts.
Forecasting, the future in your hands
Forecasting is an incredibly important part of cash flow management. Keeping track of everything from your client invoices to supplier supplier expenses in one easy place means you know what to expect, and can keep control of your cash flow.
We make it super simple to view your finances or update information. Our live financial dashboard means insights are just a click away from making smarter decisions.
Ready to learn more?
There’s always more that you can do to be a cash flow management master. Download our E-guide today, for fantastic tips, tricks and secrets that’ll transform the way you view financials.