In this episode, David looks at one of the biggest reasons businesses fail – a lack of cashflow. A problem that can, on occasion, even lead to profitable companies having to close their doors.

The higher cost of materials and labour coupled with increasing tax take, and downward pressure on what they can charge is leading to more firms experiencing severe cashflow issues. David explains what business owners can do to relieve some of that pressure and have access to the money that is necessary to buy the materials needed to fulfil their next order and keep the lights on.

To explore how to get unstuck on your mission, put your purpose into practice and convert your ideas into impact book a discovery call with David here https://calendly.com/david-peoplewithpurpose/30min

KEY TAKEAWAYS

● Businesses are finding mastering cashflow increasingly difficult.

● Worries about having enough cash available to pay tax bills are widespread.

● Some businesses are afraid to take advantage of things like R&D tax credits because they worry it will trigger a compliance check.

● Being able to create, manage and multiply cash flow through a business is essential.

● Create a cashflow forecast as well as a sales forecast.

● Your cashflow forecast needs to cover a rolling 13 weeks.

● When your business is cash rich take advantage of those periods to invest and get things done.

● Make sure you are clear about what your net profit is and the break-even point for each product or service and its timing.

● Getting paid in advance makes a huge difference to cashflow. David shares several ways to do that.

● Make it easy for customers to pay you.

● Remind customers when payment is due and chase up late payers at an early stage.

BEST MOMENTS

“Cash is a perennial problem…. Everything affects cashflow.”

“When you go through a cash flow challenge you learn so that you can prevent future cash flow problems.”

“I've seen this as a problem in businesses of all shapes and sizes, £100 million business, as well as £100,000 a year turnover business.”

“Make sure that you understand, where the money's moving, but also the timing.”

“Find someone who's good with a spreadsheet and make sure that you know where the movement is in your business. It´s a game-changer.”

EPISODE RESOURCES

https://alexanderclifford.co.uk/blog/hmrc-compliance-check-for-r-and-d-tax-credits

ABOUT THE HOST

David Roberts is a highly regarded CEO, mentor, and investor with 30 years of experience across multiple sectors. As an intrapreneur and entrepreneur, David has bought, grown, started and sold several businesses, working with values-driven start-ups, award-winning SMEs, and multinational corporations on strategies for service excellence, leadership, and profitable growth. David’s passion is for purpose and creating an environment where everyone can succeed, through building teams that get things done, execute on their mission with passion, deliver exceptional service and really make a difference.

CONTACT METHODS

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Email - david@peoplewithpurpose.live