Having analyzed thousands of financial statements prepared for individuals and small businesses, numbers are a second nature to me. However, not every small business owner has a business degree or worked in financial services. Passion, risk taking, vision, and drive are the most common traits of an entrepreneur. The success in selling products and services is linked to the ability to tell the story. However, the top line revenue is only a part of the story.
Business coaching offered at Positive Coaching fills the gap between the ability to tell the story and the bottom line and, in doing so, understanding cash flow is the key.
The process of cash flow mastery starts with creating awareness of what a typical cash flow and its elements should look like given the size and the industry. There are many factors that affect cash flow directly and indirectly. Working towards the ideal cash flow, these factors get acknowledged, measured, and improved. A new structure may be put in place to provide for a sustainability of the improved cash flow.
Cash flow is often confused with sales or net income. Think about cash flow is that of a blood inside a circulatory system of a human body. The heart is a checking account. The blood comes and goes. We need blood for a healthy operation of a brain, lungs, stomach, muscles, etc. In a healthy body, the blood travels with minimum restriction in and out of heart. Similarly, a healthy cash flow is vital to an overall health of a business.