Everyone has heard “fifty five per cent of start-ups fail within the first five years.” One of the biggest reasons small business fail is due to issues with cash flow. So, how do small business owners avoid cash flow problems with their fledgling business? We found a great article on Business2Community.com.
“Managing your cash flow should be one of your main priorities. Sounds obvious, right? Then why is it that one in ten businesses are failing to accurately forecast their cash flow, or are neglecting this area of their business altogether?”
Here are three of the most common killers of cash flow you should avoid:
- Paying everyone at one time. The solution? Come up with a payment schedule that works with your cash flow.
- Unreliable clients/customers. How do you cope? Devise strict payment instructions. And, don’t shy away from the idea of penalties or, one a more positive plane, incentives to pay in a timely manner.
- “Forgetting that cash is king.” What to do? “You must have a cash cushion to call upon in the event of unplanned expenses. This might include hiring more staff during a busy period, buying more stock, repairing equipment or covering costs of a late payment.”
Starting a small business is no easy task. So, make sure you set yourself up for success by considering your cash flow and making it a priority.
Now, if you could benefit from an immediate cash flow, you should consider a small business loan. There are some great loans out there for small business owners, so head over to SilverRockFunding.com and apply today. You could receive up to $500,000 for your small biz.