A business can only be managed well when the owner has an understanding of cash flow the need for a budget. It is often too easy to continue to pay outgoings and expenses and lose track of what is coming into the business. You may then realise that you don’t have enough funds to support business continuity or for the improvements you want to implement in the near future. Knowing what is coming in and going out of the business (cash flow), helps you to plan and avoid surprises.
Many businesses have gone under because of poor cash flow management. To minimise the possibility of a cash problem the answer is as simple as understanding your budget and cash flow. Once again, this is how you get to know your numbers!