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Business Unplugged™
This blog features Carol Roth's tough love on business and entrepreneurship, as well as insights from Carol's community of contributors.

Cash Flow: Oxygen for Your Business

Written By: Catherine Morgan | Comments Off on Cash Flow: Oxygen for Your Business

able to breathe As a small business owner, your business can feel like a living, breathing entity. In order to grow and flourish, your business needs predictable and reliable cash flow.

In Carol’s latest post on MasterCard.biz, “How to Avoid a Cash Flow Crisis,” she says:

“Think of cash flow as the oxygen for your business. Without cash, your business will suffocate. Payments to yourself, employees and vendors can be put at risk when you haven’t been paid by a client.

And here’s something that small business owners don’t often think about: Your business can suffer huge financial stress after making a big sale.

Are you confused? I’ll walk you through an example.

Let’s pretend you’re a small business owner who sells t-shirts. You just got a big order from a big box store and you and your staff are over-the-moon excited. What you didn’t think about is that you will need to make and ship the t-shirts, so you will have to pay vendors for the shirts, the printing, the packaging, and the shipping—but you’ll probably wait 90 days for payment from the big box store.

In the meantime, your employees, landlord, electric company, and more will all expect to be paid on time. Sometimes a big order can almost put your business out of business!”

You can read the rest of the post here.

Article written by
Catherine Morgan is the founder of Point A to Point B Transitions Inc., a virtual provider of coaching services to individuals who are in business or career transition. She specializes in helping entrepreneurs transition to corporate jobs they love. Catherine is the author of the eBook Re-Launch You: Discovering Your Point B and Embracing Possibility. An experienced independent consultant who was employed by three of the former Big Five consulting firms, Catherine speaks frequently on topics related to career transition, small business, productivity, and mental health. She doesn’t take herself seriously, but takes her subject matter very seriously.