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Cash is King! Here are 19 ways you can improve your cash flow... 1. VOLUME - More volume from existing customers 2. VOLUME - Bring in new customers 3. VOLUME - Get referrals from existing customers 4. VOLUME - Run marketing campaigns for new leads 5. VOLUME - Launch new products and categories 6. PRICE - Launch higher-priced new items 7. PRICE - Raise prices on existing items 8. COGS - Get better deals with your suppliers 9. COGS - Automate processes and production 10. COGS - Manager better and learn from returns 11. SG&A - Cut the marketing budget 12. SG&A - Optimize the payroll 13. SG&A - Cut other spend like travel and consultants 14. SG&A - Find new ways to run your logistics 15. PP&E - Increase return on assets 16. PP&E - Develop proprietary technology 17. INVENTORY - Increase inventory turns 18. INVENTORY - Better inventory management 19. INVENTORY - Increase your buying efficiency This is by no means a complete list. There are so many ways you can optimize cash flow. It's essential that you identify through an analysis where is the biggest potential. Then bring the right people around the table to discuss actions to take. Decide on what to do and follow up if you get the desired results. If yes, push for more. If not, find out why and execute better or do something different. That's the WHAT and HOW of increasing cash flow. Your move. What will you do next? #finance #accountingandaccountants #cashflow #careers Credit to CFI for making this cash flow driver tree. --------------- 🧑💼 I'm a partner at Business Partnering Institute 🆘 Need immediate help in your finance team, call us! 🤝 We help increase the influence of your finance team 🔔 To see more content ring the bell on my profile 📻 Find our #FinanceMaster and The Softer Side of Finance podcasts on your podcast channel
Sorry Anders, but these are all points to increase profit- which can increase cash flow as more income and less expenses increases usable cash. But it also could not - as cash flow is not profit. If you want to improve cash flow you need to improve cash management - make sure your receivables are lean and loan repayments are wide spread for example. I would agree with your points if you call it "get more cash coming in" but it's confusing if you call it cash flow.
I’d challenge you to think about this diagram over time (duration). Startup, growth, plateau, decline. What’s important as you move through those stages. What are the key metrics. It’s also important to recognize that your business is a portfolio of smaller SBUs all at different stages. This is a totally different mindset to the P&L based way FP&A works today.
Anders Liu-Lindberg If cash is the king. Then treasurer is the king of king?
Very interesting Anders...just a few suggestions, Overhead should be in COGS not SG&A and managing working capital (Accounts Receivable and Accounts Payable) is key in managing cash.
True, i would add WORKING CAPITAL- “Improve Cash Conversion Cycle”.
Anders Cash is undoubtedly a critical aspect of any business or personal financial management. Maintaining healthy cash flow is vital for businesses, especially during times of economic uncertainty or market volatility. By having cash reserves, businesses can weather downturns or invest in opportunities that may arise.
Cash may be king, but it's not the only thing. Improving cash flow is crucial for any business. But cutting expenses and increasing revenue is key.
Fully agree, but I would add mix as another revenue source of growth, pricing isn't so feasible in some circumstances/markets.
I don't understand how point# 4(marketing campaigns) and #11(cut marketing costs) are both on the same list...
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1yInteresting post. It has a lot of thumbs up, comments and reposts. This is the problem with "Cash is King" Finance experts. If you look, there is no depth or substance to this post. Before sharing this with a client, realize it is useless to them. You want some advice that gets some results from a real expert on the subject? #1 get your clients on a cloud accounting package and a CRM. #2 get those books and sales input into a visual forecasting platform. I'm biased, so check out dryrun.com. Seeing is believing. They will understand the peaks and valleys coming at them. Your job, smooth that shit out. For the rest (19 ideas..PFF), CHATGPT is free and can spit out thousands of better ideas with detailed plans of execution. (Understand what your clients do. Ask questions on why, then ask CHATGPT for some strategies) Focus on 1 idea, each month (only 1 idea) that will gain a 1% YOY move forward. Every business can be improved by 20%+, so that gives you 2+ years to make a difference. Charge 1/10 the money you bring to the client. Now go back and really look at the advice giving in the post. was it worth your thumbs up and reshare. Seriously: Get better deals with your suppliers. Someone wants to pay you for that?