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5_Warning_Signals_Your_Business_Might_Have_A_Cash_Flow_Problem
| 5 Warning Signals Your Business Might Have A Cash Flow Problem
A key reason for business failure is poor cash management. If
you don’t pay attention to your daily cash flow, you face
extinction; yet so many business people loss site of their cash
flow. No matter how fantastic your company’s products are, you
will not survive unless you generate sufficient cash flow to
sustain it. It is not the goods or services that are the
end-products of your business, it is cash.
1. You are exhibiting a decrease in liquidity (you are running
out of working capital).
2. You are overtrading by selling more than you are capable of
dealing with financially.
3. You have excessive short-term debt. 4. You are missing
discounts on your payables or you are paying them beyond the
stated terms.
5. You are collecting your receivables slowly and outstanding
receivables are piling up.
About the author:
Jeff Schein is a CGA and offers advisory services in the areas
of business planning, business modeling, strategic planning,
business analysis and financial management for new ventures and
growing small businesses. Visit www.companyworkshop.com or
mailto:jeff@companyworkshop.com
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