Many of my clients manage their cash flow by looking at their bank statements after the fact.
In many ways that’s like putting the lead on the dog to take her out after she already went all over the rug.
Cash flow is often overlooked until its pain is too difficult to ignore.
But if you put some structure and processes in place to improve your cash flow, you’ll not only make your business more profitable and predictable, you’ll also make it more enjoyable to run.
Think of cash flow like your heart and circulatory system.
If it’s blocked or stopped you die, regardless of your physical health and conditioning.
Optimise it and make it run smoothly, and you’ll discover a more vigorous and profitable business day after day.
Which brings me to Sarah, a bakery owner.
She makes great cakes and breads, and has a popular catering business, but she’s struggling to pay the bills and keep the business going.
Everything gets poured back into the business. Sales are up, but her bank account is going down.
She’s gone back to the lifestyle and food choices she had in university.
Frustrating as she thought the days of potluck dinners and pasta marathons were over.
Sarah was making money but was having trouble with her cash flow timing. She was in a negative cash flow cycle where more cash was going out of the business – to suppliers, rent, salaries – than she was bringing in from paid invoices.
It got so bad she would constantly wake up at night with her heart pacing and pillow drenched in sweat.
Worse yet, she had to rely on lines of credit and even her credit card to cover her expenses while she waited to get paid.
And the delay in getting paid was getting longer and longer.
Sarah had to reverse this situation.
She had to get cash flow positive, so she could better cover her expenses, invest in growth, and create a rainy day fund for the unexpected.
And of course, positive cash flow is critical to selling the business one day. She didn’t want the situation where a buyer could slash the price he was willing to pay because he would have to put up cash to cover her working capital.
Sarah knew positive cash flow is the sign of a healthy, well-run business. It’s the proof that her business could generate profits now and in the future, and that it’s a real investment worth bidding on.
Tomorrow, Sarah shows us how she made the shift and reversed her situation with solutions that most of you can start implementing tomorrow.
To Your Success and Sanity,
George
Thinking About Selling Your Business
We know you’ve worked hard on your business. What if we told you there’s a way to make it even better, and position it to sell one day at the top price? With Socratic Scaling, we can show you how.
In as little as six months, we can help your business stand out, scale up, and become something others would have to pay top money to buy.
The best part is these benefits start today. Even if you don’t want to sell, your business will put more money in your pocket, free your time, and be more enjoyable to run.
But you need to start getting ready now. Don’t be like the 7 out of 10 business owners who put it off until tomorrow and then find out they’re stuck with profitable businesses that no investor wants to buy, or child wants to inherit.
Click here to transform your business to give you the life you want – starting today.