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Types of cash flows
Three types of cash flows
It is customary for entrepreneurs to divide the cash flow into receipts and disposals and compare: if the amount of expenses is greater than the amount of receipts, then the month is unsuccessful, and if vice versa, everything is fine. This is the fastest way to assess the state of affairs in a business. However, it is not the most accurate, since a lot depends on what the money was enough for.
For example, in one month they overpaid for the maintenance of the office – they updated the form of employees, but at the end of the month there was not enough money for basic expenses – salaries and rent. Continue reading
Business financial health
It happens that a company looks successful, healthy and rich: every month it opens a new branch, hires its second thousand employees and does not leave the front page of Forbes. But then – once, and bankruptcy. This happens when the owner looks only at the scale of the company or turnover, and these are not indicators that really reflect the financial health of the business. About those – in the article.
0. Profitability
Before we get into the metrics, let’s look at the types of profitability. Continue reading
5 ways to make your business financially sustainable
Business financial sustainability is like that 2000s meme girl—hard to find and easy to lose. Especially if you don’t know what indicators to monitor and what to work on in these “difficult relationships”.
Someone believes that if he just covers his expenses and does not allow cash gaps, then he is quite firmly on his feet. But not everything is so simple. For a company to be considered financially sound, it must be able to easily adapt to a changing market and grow in profits and capital even during times of turmoil. Our five-step guide will help you achieve this state. Continue reading
