The title to this post is not news; we all know that cash is a business’s lifeblood. And in the Canadian textile screen printing industry, which is for many printers a seasonal roller coaster ride, cash flow is a headache in the slower season. For instance, right now in the post-year-end middle-of-winter slower period, cash flow can be tough. So what can be done to even flow out a bit and make the slower periods more manageable?
Well, I recently saw an article sponsored by American Express that offered “five steps to improve cash flow.” However, it seemed that the writer was being paid by the word because all “five steps” explained at length could essentially be condensed into one key tip articulated in a few words. And that single “umbrella” tip is that you must make sure that you always understand not only how much money is flowing in and out of your business at any one time, but also what can be expected to flow in and out in the short to medium term. Forewarned is forearmed. This requires cash flow planning and projecting as part of your overall financial planning. if you’re not comfortable with “bean counting”, consult a “bean counter.” An accountant can be a a very valuable and, sometimes, a business-saving, resource.
That’s it. That one “umbrella tip” (especially the bit about soliciting the help of an accountant), will take care of your cash flow planning and management.