For a small or growing company, managing cashflow can be something that gets overlooked. The focus in any business is always going to be on finding and retaining customers, providing good service, and developing new products.
Yet, companies are more likely to go out of business simply because they run out of cash, than for other reasons. “The number one reason people fail is that they run out of money,” says David Goldin, founder, president and CEO of Capify.
Cashflow forecasts can be an invaluable asset to stop you getting into trouble. Done properly they will alert you to do something if trouble is on the horizon. “Planning gives you the opportunity to ask your business the right questions to avoid unnecessary costs, and to charge the right price,” says Michael Ogilvie, client services director at chartered accountancy practice OBC.