Cash flow is a common problem for many small businesses. In fact, 1 in 7 small business owners have been left unable to play employees because of cash flow issues. Having problems with your cash flow can have a significant impact, particularly on small businesses.
Why is cash flow so important?
Cash flow management is at the foundation of any business. Businesses must aim to have more money coming into the business than is leaving the business, allowing cash to ‘flow through’ and storing some in reserve. When a business has more cash going out than coming in, disaster can strike, especially if this occurs for a significant period. A business will begin to eat into cash buffers, potentially risking closure.
It is therefore essential that small businesses have a strong cash flow management strategy in place.
So how can SMEs improve their cash flow?
This article will explore 6 quick-wins SMEs can make take to improve cash flow in 2021.