Article by Rob Caldwell

“You can have the most amazing invention, fantastic product, offer the most outrageous customer service or possess the most professional practice… but run out of cash, and you’re surely S.O.L.!”

During my 25 years of Coaching and Consulting with business entrepreneurs, medical professionals, legal associates and other educated professionals, have allowed me some startling observations related to these professionals and Business;

a) Most highly educated professionals (i.e. Doctors, Attorneys, Teachers, Physicists, Pharmacists, Scientists etc) are so involved during their formal education, learning and perfecting their chosen specialties that they have learned (and were taught) little, if anything, about the profession of managing money and operating a business!

b) Additionally, I’ve observed that most of these same professionals, when entering their own business (for the first time or still struggling after a period of time), have gathered little additional knowledge in this area and have even fewer ideas on the “how to” of business.

c) And sadly, I’ve observed that without formal business training or professional coaching…. they will fail or quit before reaching success!

As a side bar to my observations, the Small Business Administration (SBA) publishes that 4 out of 5 businesses will fail in the 1st year of operation and 4 out of 5 of the remaining businesses will fail in the next 5 years!

(I will add, however, that with business training or professional coaching, these same professionals rate of success is increased exponentially!)

How does “Cash Flow” rank in the overall hierarchy of business operations?

Well…. Think of it this way….

You can have a great product or service, enjoy great staff and education, possess a fantastic business location, take pleasure in a respected name and reputation even boast “target rich environment” of potential customers, but if you have poor cash flow and, you’re out of business!

Again according to the SBA, over 80% of business failures are directly related to poor cash flow and insufficient working capital.

Think about this:

With Insufficient cash flow:

* We lose valuable trade discounts,

* We suffer personal humiliation in our inability to pay our legal and moral obligations,

* Our employees and supporters are not happy; some may in fact leave us,

* We suffer financial and personal embarrassment,

* We can even suffer the trauma of potential bankruptcy.

There’s NO Bull here. This is not good! In today’s vernacular, “This sucks!”On the other hand, however, with sufficient cash flow:

* We always have enough to meet our moral and legal obligations,

* We can look forward to business growth, expansion and our own personal satisfaction,

* We can enjoy the Lifestyle we work so had to achieve,

* We can acquire and enjoy the things we desire and provide for ourselves and the people we care about!

There’s also NO Bull here. This is all good!So onward.

For the purpose of clarity, following are some terms in the “Cash Flow Pictionary”:

* Definition of “Cash Flow”"The time between our customers paying for our services and we pay our creditors and employees”.

* “Ideal” Cash Flow : )”When our customers pay us for our products or services when they are rendered or sold!

* “Real World” Cash Flow : ( “The time between pleadings with anyone that owes us money to pay as rapidly as possible while we delay paying our creditors as long as possible!

OK, enough of the good the bad and the ugly, let’s move on to some…

“NO BULL” Tips and Strategies that will keep your business out of the “Stink” and keep it “Smelling Sweet”!

Rule #1: In business, Cash is King!Rule #2: When in doubt about the future, refer to Rule #1

TIPS:

1. Establish a written Cash Flow Plan ( a Realistic one)Don’t have one? Make one! Without it, you’re lost in the wilderness! End of first lesson!

2. Update your plan regularly What good is following an old road map?

3. Conduct credit checks on non-cash customers (or non-insurance patients and clients)First, accepting non-cash or in the medical profession, non-insurance patients are bad business decisions no matter how you look at it, and second, you don’t have to do it!

4. Invoicing AccuracyYou would be surprised how many businesses (of all kinds) don’t give this area proper attention!

5. Bill PromptlyOver 1/2 of new (and existing) businesses put off billing until “Friday or the 15th or 30th what-ever!

6. Depositing Payments PromptlyLetting the check sit in a drawer doesn’t help anyone!7. Accept Credit CardsGreat way to improve cash flow!

SUMMARY……There are numerous ways to address Cash Flow. These are just a few of the most obvious and the simplest to implement.

About the Author

Rob Caldwell is a successful Business Specialist, Consultant and Coach known for his “No Bull” approach to coaching those searching for success, scratching for profits, or fearing business failure.

Get his free “4 ½ CA$ H Flow Rules GUARANTEED to make your business Survive and Thrive!” AND his “24 CA$ H Flow ‘Miss-Takes’ to avoid and HOW to make them work for you” by visiting http://www.coachingclubhouse.com.

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