Tips on Better Cash Management

Sir Richard Branson, a business magnate, investor, author and philanthropist has rightly said: “Never take your eyes off the cash flow because it is the lifeblood of business.”  For a layman, when the term “Cash” comes across, he/she interprets it in economic conditions which are the money in the physical form of currency like banknotes and coins. But this has a very different meaning in terms of finance. In financial terms, cash is current assets consisting of money equivalent that can be used immediately or near-immediately. This mostly includes Bank Accounts and marketable securities such as government bonds and investments. Cash, being the lifeblood of the businesses of all magnitudes, becomes an essential asset and hence is needed to be managed well.  Cash Management refers to collecting, handling and usage of cash; market liquidity, cash flow and investments. It is one of the critical aspects of the financial stability of an organisation. Here is a simple example of why cash mana

4 Cash Management Tips for Startups

Starting any new business is a challenge for every businessman. The biggest problem that new businesses face is the lack of capital. Generally, the new businesses manage to raise funds for carrying out their business activities but cannot send them wisely.  The businesses operating without proper cash flow management systems have no future. So today, you can learn some useful tips to manage cash flow in the startup.  1 . Find the goals  You must start with a good plan for your startup. For that, you should pick the areas in which you want to spend your business cash. This will further make it easier to spend cash for important things. Apart from that, you can also manage business expenses from the given amount.  The vision is very necessary if you want to go a long way in your new business. Furthermore, the proper cash management plan will save unwanted expenses.  Related - Manage Cash Flow in Small Business 2. Liquid cash  This is one of the best tips for managing cash in new busin

How to Manage Cash Flow in Small Business?

Cash Flow Management in Small Business When we talk about managing Cash Flow in a small business, the first question that needs to be answered is What is Cash Flow? Cash Flow is basically the movement of the funds or cash in and out of your Business. Kinds of Cash Flows: Positive Cash Flow: When the cash entering in your business is more than the amount leaving your business, the Cash Flow is said to be positive. Negative Cash Flow: When the cash leaving your business is more than the cash or funds entering your business the Cash Flow is said to be negative. While Positive Cash Flow is considered ideal or beneficial for the small business, the Negative Cash Flow is considered as a bad sign or simply a problem. In managing cash flow in a small business, unreliable cash flow could be disastrous, even a short-term cash flow problem could make the payment of purchases and employees tough and end up in shutting down of Business. Hence, the need to deal with it as soon as possible arises, i

How to Manage Cash Flow?

How to Manage Cash Flow? Cash is said to be the King when it comes to Financial Management of a Company. Without Cash/Capital no business could be started or continued. Cash Flow is basically the movement of Cash or the Funds in and out of your business. The Cash Flow should be tracked either weekly, monthly, or quarterly. The time when payment is to be made to suppliers and employees and the time when payment is to be received by your customers, the time period between both events which causes a shortage of cash is the problem that could be solved by Cash Flow Management. Cash Flow Management is simply delaying payments to be made by the company for as long as possible while encouraging everyone who owes you money to pay it back as soon as possible. In this article, we will be seeing how one can Manage the Cash Flow easily and what are the tactics or methods that can help you out with your cash flow problems- Measuring the Cash Flow  To manage cash flow , measuring the ca

How to calculate cash flow?

How to calculate cash flow? Cash flow is the representation of how cash moves in and out of your business. However, for small businesses calculating cash flow is not as simple as it sounds. The cash flow formula is a lot more from estimating revenue or expenses alone.  This is why many entrepreneurs fail at this stage because it is ultimately cash that you need to pay bills. For small businesses, cash flow management is a crucial component of the firm's financial state.  Every business owner needs to know what is cash flow and what it means for its business. Let's get a better understanding of how cash flows into and out of your business & how to manage cash flow for small business. There are three formulas for calculating cash flow and these are described below in detail.  1) Free Cash Flow (FCF): One of the most basic and significant cash flow formulas is free cash flow (or FCF). A regular cash flow statement reflects the state of your business’s