Business Tips

Ways to managing business cash flow

Maintaining a stable business cash flow is one of the most significant building blocks for any company looking to expand meaningfully. Read on to find out some ways so you can confidently scale your company and make better decisions for your business today!


One of the most critical building blocks for any company to achieve meaningful growth is maintaining a healthy cash flow. This is particularly true during periods of economic instability, when effective cash flow management may make the difference between thriving and failing companies. Almost every business owner understands the importance of managing cash, but designing a mechanism for business cash flow is far easier said than done. At GGE Corporate Advisory, we’ve spent a lot of time considering how we can best assist our clients in managing this operation. We break down our process for assessing and streamlining cash inflow and outflow in the following paragraphs so you can scale your company and make large business purchases with confidence.

Make a budget that is easy on your cash flow.

Managing cash wisely starts with maintaining a healthy budget. In order to attain or retain a positive cash flow into your business, you must ensure you are not spending more than you make. Most business owners know this to be true, but creating a realistic budget can be challenging. To avoid scraping the bottom of the barrel at the end of each month, be conservative, rational, and give yourself some wiggle room. When making your budget, keep the following points in mind:

1.    Historical Expenses: Base your budget on the months that were the most costly. Be sure to account for any large-ticket items that arise only once a quarter or infrequently.

2.     Time to Payment: How long does it take for money earned from your products or services to reach your bank account? What effect would this have on your budget?

3.     Recurring Expenses: Receipts for recurring expenses. Look for ways to cut expenses in order to generate more positive cashflow month after month.


Examine Your Cash Inflow and Outflow to Determine Profitability.

The aim of maintaining a positive business cashflow is to help your company achieve long-term profitability. When you look at your cash inflow and outflow over a longer period of time, you will see how successful your company is now and how profitable it will be in the future. You can also compare profitability to that of a rival (as long as they’re publicly traded) to see where you stand in your sector.

If you discover that your business isn’t sustainable, you’ll need to create a plan to get back on track. Start by reevaluating your budget, going line by line to see which things are essential and which you can do without to boost your net earnings.

To finance large purchases, establish a cash flow management process.

Don’t overextend yourself by being overconfident. Managing the cash flow and profitability requires planning ahead for large-ticket purchases. Whether it’s for new appliances, office repairs, or other non-recurring monthly expenditures, it’s important to prepare ahead of time so that these costs don’t affect your company and cause you to fall behind.

Establishing a specified, reliable procedure, like most aspects of running a business, can help you save time and prepare more effectively for larger expenses. Create a weekly time to review all of your accounts, create monthly forecasts to predict incoming cash, set up automatic investments for large expenditures, and plan for any loans you may need to achieve your goals. To make sure you’re on the right track, compare monthly outcomes to each forecast.

Automate Cash Flow Accounting.

You’re short of time and can’t fit another meeting into your schedule? You can outsource the reporting of transactions and main cash flow measures by investing in controlled accounting software. Your dedicated bookkeeper will assist you in keeping track of these things so that you are always aware of the state of your company’s cash flow. Furthermore, managed accounting services will submit invoices and accept payments automatically. This not only makes you your money faster, but it also gives you a more clear view of your company’s financial situation.

With GCA’s controlled accounting solution, you can bind all of your accounts while we safely and quietly reconcile your books in the background. We will assist you in managing your payroll, tracking your spending, preparing tax records, and automating your cashflow accounting so that you don’t have to worry about it. When you sign up with us, you get a personal bookkeeper, certified accountant, and CPA on your team who are always available to speak with you. The combination of a dedicated bookkeeper and smart automation will help you handle cash flow more efficiently while freeing up resources to work on other important aspects of your company.

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