All in Accounting
Managing cash flow is a vital part of running a successful business. Some business owners think managing cash flow simply means keeping track of how much money enters and leaves their business, but there’s more that goes into it. Cash flow forecasting, for example, is an incredibly valuable tool that helps you anticipate cash flow issues, plan for days when your cash flow is limited, and show the bank that you are prepared.
For many business owners, determining the success of a business comes down to how much profit the company makes. Of course, finances are an essential measure of a company’s overall success. If you don’t bring in more than you spend, you won’t be in business for long. Profit, however, isn’t the only relevant benchmark by which to measure your activity.
For most businesses, especially small businesses, recessions can be brutal. Just take, for example, the Global Financial Crisis (GFC) that struck the world in 2008. Between December 2008 and December 2010, approximately 1.8 million small businesses shut down. When Investopedia looked into the impact of the financial crisis on small businesses after a decade, they found out that business creation has not yet returned to pre-crisis levels.
