If sales dried up, how long would your business be able to operate?
Do you ever have times when a major expense could wipe out your cash reserves?
Businesses are just as prone to living “paycheck-to-paycheck” as individuals can be. And for that reason, building a healthy savings is just as vital.
It’s hard, especially when starting out, because there are so many demands on the business’s cash flow: various expenses, payroll if you have employees, and of course paying yourself.
But I always encourage my clients to set some aside from every sale for building a cash reserve.
At first, 30 days should be the goal. But in the long-run, a three-month cash reserve is ideal.
It’s enough that you should be able to keep up with the expenses even if there’s a slump in sales for a time.
As a business owner, it’s important to think long-term, not just about the next month or quarter. If you plan for the long-run, you can withstand any curveballs that might be thrown your way.
If you’d like to feel more in control over your business’s cash flow, join me at 6PM Eastern tonight where I’ll discuss tips and strategies for better managing your cash flow to lead to greater success for your business. You can join on Facebook, or register via Zoom.
In support of your vision,