Importance of Cashflow in business

      

     Over a couple of years based on the most recent statistics ,a resolution was drowned that almost 45 percent  of new companies are closed after a span of nearly 5 years afer they are started,then 65 percent experince the same after a span of around 10 years.This resolution should hit back to you with the questions like,How do the remaining 35 percent be in a position to keep their profile and stay in the market despite the competitive advantage which always seems to be  against them.There is no magic here,it is because this businesses have mastered the principlces of money and intergrate them into their systems do that they take advantage of the system and outsmart the rest of the businesses who haven't understand these basic principles,they have understand how money works and how to use it a weapon to generate more money.The fundamental reason as to why these businesses are always thriving and getting better day by day is because they have mastered how to manage cashflow.To put it in simple understandable format about it's definition,Cashflow is the flow of money(cashform or liquid money) into and out of the organisation.




       Basically before you get started with any business,you must be in a  position to hold some cash which will be used to run the business for the first couple of months to make sure that the cashflow management is at it's peak, ( the money caming into and out of the business is not used to run the day to day business wants for the first couple of months ),this idea is normally used in large companies which are starting out.These companies are more likely succeed because they are able to keep track on the amount of money the business generates,With that being said,they are in a position to determine whether it is a likely scenario that the business will succeed if they decide to venture into this business or not.Cash in newly formed companies is also essential as it allows you to gather for day to day emergencies to make sure that the operations of the company are efficient as possiible without having to have undergone the whole procurement process before the money is withdrawn from the company's bank account,this sometimes is the idea that most people think it is the always good to have all the money for the business in a bank account ,but i can tell for sure,,based on my research that it will significantly impact the company's day to day operations.This really highlights the key importance of always having some cash to run the business operations for the first couple of months.

    Written by ignitepathway,follow and leave a comment if you want me to delve into certain topics which are relevant to you,,

Comments

Post a Comment

Popular posts from this blog

"iPhone 16: Revolutionizing Tech or Just Another Upgrade? Pros and Cons Unveiled''

Image
  "iPhone 16: Revolutionizing Tech or Just Another Upgrade? Pros and Cons Unveiled'' " The iPhone 16 has hit the market, creating a buzz in the tech world as Apple continues its tradition of delivering cutting-edge devices. But is it worth the hype? Let’s dive into the pros and cons of this sleek device to help you decide if the iPhone 16 deserves a spot in your pocket. The Pros of iPhone 16 1. Revolutionary Display Technology The iPhone 16 boasts a groundbreaking LTPO OLED display with a 120Hz refresh rate, offering unmatched smoothness and vibrant colors. Its edge-to-edge screen design is a visual treat, making streaming, gaming, and browsing an immersive experience. 2. Unmatched Performance Powered by the A18 Bionic chip, the iPhone 16 is a beast when it comes to speed and efficiency. Whether you’re multitasking, gaming, or editing videos, this processor handles everything seamlessly while optimizing battery usage. 3. Advanced Camera System Apple continues ...
Read more

High demand skills to learn after high school

Image
  Normally after you are done with high school,you are often in a dilemna to explore more in the outside world or just sit back and watch things unfold which most of you normally do but that should not be the case,here is a list of high demand,high income skills you can learn to make you stand out in the current job market,land a high paying task in the freelancing space and also develop your own technical skills as a student or just somebody out there who needs to earn an extra income,😊     I will categorize this topic into four concepts. 1)Technical skills. 2)Soft skills. 3)Where to learn these skills. 4 )Where you can work and get paid by doing simple tasks as long as you have a small background understanding in you choosen skill set.         1)Technical skills. -Below is a list of high demand skills that you can learn  for free as long as you have access to a phone or a computer and an internet connection,,it doesn't matter the level of educa...
Read more

Difference between diabetes insipidus and diabetes mellitus.

Image
 Diabetes is a disease that is caused by inflamation of the pancreas or the hypothalamus part of the brain.Their are two type of diabetes:                              a)Diabetes insipidus.                             b)Diabetes mellitus. Diabetes insipidus is a disorder that is caused when the pancreas fails to produce enough insulin hormone.Insulin hormone is important in converting glucose to produce energy which is used by the body,hence when their is inadequate insulin hormone produced by the pancreas,it means that the glucose in the food we eat will not be converted into energy hence the body will break down fats stored in tissues into small fat droplets through the processs known as emulsification to realese energy. Diabetes mellitus on the other hand is a disorder that is caused when the hypothalamus part of the brain fails to prod...
Read more