Enhancing Cash Flow . . . and My Favorite “F” Word

We’ve finally made it to #5 of my top 5 proven methods that have helped companies obtain positive results in cash flow and profit. Are you still with me? Here they are again, just as a review:

  1. Unlocking the Secret of Your Cash Flow
  2. Working Capital – How Much Do You Need?
  3. Profit Does Not Equal Cash
  4. The Secret: Your Financial Score Card is Not Secret
  5. My Favorite “F” Word

Remember I mentioned that 60% of most companies fail in the first 5 years even though they are generating profitable revenues? Lack of Financial Intelligence is the #1 contributor to this problem, which brings me to my favorite “F” word. Did you guess it?

#5 My favorite “F” Word.

Most of us have heard “fail to plan…plan to fail”.  I’m a huge advocate of FORECASTING how we want our business to grow, then measuring and tweaking as needed as the plan becomes reality.  Unfortunately, most growing companies fall short in this area.  Excuses include “we’re moving to fast to take the time “or “we don’t have the skills in-house to do it”.  For many, these are the mottos of the 60% who fail to thrive.  For the Financially Intelligent businesses that start the process of forecasting and improve it over time, they’ll ultimately narrow in on their objectives and get closer to a Cash Flow “Bulls Eye”!

Your Profit Plan, prepared for a minimum of one year:

  • Includes Forecasted Income Statement, Forecasted Balance Sheet, and Forecasted Cash Flow including Operations & Capital requirements.
  • While it is never accurate to 100%, this Plan does provide a vision of your future as you’d like it to look.
  • Also, the process of preparing the Profit Plan will provide insights, discussions and most importantly, strategies to make it all happen.

I’d love to hear your comments or questions on any or all of the 5 surefire methods for enhancing cash flow.  Thanks for taking your valuable time to read my recommendations.  Congratulations on increasing your Financial Intelligence!

To your success!

Written by

Rick Arthur is a CFO whose expertise is built on Financial Intelligence and 35 years in senior financial roles. Coupled with a CEO’s perspective and the experience of building his own $20 million company, he brings a unique depth of insight into business from the top down. Wired to get to know people, Rick works hand-in-hand with business owners of intentional, growth-oriented companies, solidifying relationships as a trusted advisor and confidant to his clients. He leverages his experience to help business owners gain traction and stay laser-focused on the company’s vision, cash flow, and profitability – all while creating big picture solutions for strategic planning, growth and sustainable success.