10 Cash Flow Management Habits Every Business Owner Must Have
Business owners with good cash management habits are more likely to have a growing, successful business. They have more control over their business’s cash and more time to grow their business by focusing on their business’s unique value-added products and services.
Here are ten (10) habits you can adopt to help put your business on cash management auto-pilot.
The 10 Cash Management Habits
- Maintaining up-to-date bookkeeping
- Keeping accurate books and records
- Structuring a chart of accounts for meaningful reports
- Measuring the impact of increasing sales
- Using cash management tools
- Working with a cash management dashboard
- Addressing cash shortages immediately
- Spending regular, focused time on cash management
- Maintaining a positive attitude
- Asking for help when needed
Habit 1: Maintaining Up to Date Bookkeeping
Up-to-date bookkeeping is critical for knowing where your cash is, where more cash is coming from, and where it needs to go. In other words: bank...
The Five Key Mindsets of Good Cash Managers
A business owner’s mindset about cash management is the difference between having enough cash and struggling to meet expenses every day.
When I meet a business owner who struggles with cash flow, I ask, “Tell me about your business?” They can say whatever first comes to mind, and they usually tell me the good things, starting with whatever their business is known for and what’s going well.
- “Our unique products are awesome! We can’t make enough!”
- “We carry the best selection in the area and have service to back up the sales.”
- “We have a contract with the power company that others would kill for.”
- “Our systems can handle a lot more volume. We’ve figured this out to the last detail.”
People talk forever about the wonderful parts of their businesses. Those areas that the business was built around- marketing, products, software, services… anything that helped them grow sales.
The One Thing that...
Cash Management - What it is and what it isn't
I love seeing the wide variety of businesses around the world. It’s one of the reasons that I enjoy working with small to medium sized businesses – there is so much variety and so many ways that people have figured out how to make money. They are so innovative, and it seems like it would be so fun to be part of the team!
These companies generally have:
- Innovative products and services
- Great demand-generating marketing
- A good sales team
- Operational excellence that is generally close to the skill of the founder
After that the business often has weak spots. They generally lack systems and operations that will allow them to scale, especially when it comes to accounting, finance, and cash management.
Between my experience and the conversations that I’ve had with various accountants, bookkeepers, and business consultants, I’m convinced that 90% or more of small and medium sized businesses don’t have good financial management. This includes basic...
