Cash Flow Planning for Life - Helping you reach your personal & professional financial goals.

Cash Flow Planning for Life

Helping you reach your personal & professional financial goals.

Cash flow management is the #1 key to any successful business.

Cash Flow Management

This is part 1 in my 7 part series “7 Things Every Small Business Owner Needs To Know”.  You can download this entire series in my eBook on my web site –

In today’s environment of small margins, tight credit and monthly bills coming due, it seems like every two weeks, the availability of “cash” is at a premium.

  • Where does “cash” flow come from?
  • How much “cash” will I need to start, or to expand my business?
  • What type of financing will I qualify for?
  • What banking relationships do I need?
  • What kind of bank accounts do I need?

These are the questions you will need to have answered before you hit submit on the web site to Incorporate or before you expand.

The answer to all these questions will depend on the type of business you are starting or expanding and the where-with-all of the existing business and/or its owners.

Trimming expenses is the low hanging fruit in most established businesses today.

Over the past two years, I have received daily calls from clients asking the same question; my overhead is killing my business, how do I reduce it? The answer to this questions is easy to answer and hard to implement.

The answer is cut everything, yes everything, no individual or expense item is more important than the business itself. Employees’ and owners get in a comfort zone and think they need every employee and luxury they have.

Ask yourself this question; did I need this expense when I started the business?

If the answer is no, then, well I think you know what needs to happen next.

One caveat, be careful not to cut through the bone. Cutting to the bone may be required but through the bone can damage the foundation of the company.

For example: it has been decided trimming payroll by $40,000 must be done, it would be easy to select one or two people and lay them off, who will pick up the work they were doing? I’m assuming everyone is working 40 – 50 hours per week just to keep up.

It may be in the best interest of everyone employed to take a 5% – 10% pay cut ($40K reduction in payroll expenses) and keep the one or two extra bodies around to keep the company working effectively and most important, keep the customers happy.

If you have any questions, or would like to learn more, please contact me by calling (239) 384-9688, or visit my web site at:

– Mark

This information is based on facts, assumptions and representations as stated and authorities that are subject to change.  We will not update this information for subsequent legislative or administrative changes of future judicial interpretations.

LEGAL NOTICE AND DISCLAIMER:  The information within this eBook is for informational and educational purposes only and is not tax advice and should not be used as such.  The facts of each individual situation can have significantly different outcomes when applying tax law.  The hiring of a CPA is an important decision not to be based solely on advertisements.

1 Response

  1. 7 Things Every Small Business Owner Needs To Know | Cash Flow Planning for Life Says:

    […] Cash Flow Management, Financing Options & Banking Relationships […]

    Posted on February 15th, 2010 at 11:30 pm

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