Channel Eye has joined forces with Royston Guest, leading Business Growth Coach and CEO/Founder of Pathways Global, in our column, ‘Ask the Business Coach’.
Cash is vital for growth, and a lack of it prevents businesses from realising their ambitions.
Yes, you need enough working capital to pay the bills, salaries, and other regular monthly expenses, but all you do is get by each month. To grow your business into something bigger and stronger, you need additional cash to fund the growth. If money isn’t available to put down a deposit for new premises, purchase additional equipment, fund new marketing activity or recruit, then your business cannot grow. And if it’s not growing, then it’s either stagnating or, worse, falling behind.
Three key takeaways
- Cash is the oxygen for your business.
- Know your debtor-to-creditor ratio.
- Have a monthly cash flow forecast.
Episode timestamps
- [0.39] You should have a debtor strategy, and critical factors to include are the payment terms you put in place with your clients, i.e. your debtor days, staged payments, chasing payments and credit worthiness.
- [3.45] You should have a creditor strategy, and a critical ratio is your debtor-to-creditor ratio. Knowing how much cash you have coming in versus how much is going out is crucial to your business.
- [4.40] You should have a robust cash flow forecast to help you predict peaks and troughs of your cash flow.
Do you have a question for the Business Coach?
Send your questions to askthebusinesscoach@channeleye.media
Missed a previous episode? Catch-up and watch the series here.
