Cash... it flows through your company like the blood in your veins. It is the lifeline of your business. And when it’s low will impact your company’s vitality. So performing a cash flow analysis is about as important as a yearly visit to your doctor.
Ready for a Check-Up?
First, compare your unpaid purchases to your invoices due at the end of the month. If your unpaid purchases are greater than your invoices due, you spent more cash than you will receive next month.
Low Cash Flow Diagnosis?
Second, examine the areas that affect your cash flow stamina. Review your inventory, accounts receivable, accounts payable, and credit terms. Identify the problem and you can take steps to correcting it. For example, if your cash flow problem is accounts receivable, identify why. Is it because of slow paying customers or long contract terms? Then find a solution. One option is to use a Factor. A Factor purchases your invoices, gives you immediate cash and waits to receive payment from your debtor.
There are many solutions to stimulate cash flow but the key is to be prepared. Review your finances every month. Change policies or procedures that hinder your cash flow vigor. And most importantly, use cash flow analysis as a tool for the preemptive care of your businesses long term health.
Need a Cure?
To find out if Factoring is the tool to stimulate your cash flow lifeline please visit www.universalfundingmain.com Or For immediate assistance please call: 1-800-781-3978
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