How Crucial is Business Cashflow Management to Surviving Inflation?

What is business cash flow? Is cash flow the same as profit? How crucial is business cashflow management? These are the questions on the minds of a lot of business owners.  Keep reading. We have answers.

Managing Business Cashflow is Crucial

Let’s start here. You must manage business cash flow. There is no way around it. This is even more important during inflation, as you never know how far your cash will go by tomorrow. No, cash flow is not the same as profit, but it is just as vital.  In fact, without business cashflow management, profit can become non-existent.

Here are some tips for managing cash flow so your business can be thriving and profitable.

Profit First

Profit First” is a book by Mike Michalowicz. It’s a great read that lays out an innovative new way to manage cash in your business. The profit first mentality suggested that owners take their profit from cash deposits before expenses, rather than paying themselves with what’s leftover. Of course, that is a pretty severe break from what is historically  normal. Typically, businesses pay expenses first and consider whatever is left to be profit. With the profit first approach, predetermined percentages of cash deposits transfer into various accounts before expenses are paid.

A Cash Pool Helps

Paying expenses last is scary for sure, especially when inflation is on the rise. However, reserves and a cash pool can help. The key is to have a business credit portfolio. This allows access to cash when you need it in the form of a cash pool, without damaging your personal credit. Access to cash is vital when you never know how far your cash might go from week-to-week. How do you create a cash pool with a business credit portfolio?

Using Business Credit to Build a Cash Pool

Using business credit to build a cash pool is key to cash flow management.  There are 3 parts:

  • Cash on hand
  • Amount available to spend on vendor credit accounts
  • Amount available to spend on business credit cards

Vendor accounts allow your purchases on credit. Typically, they are net accounts rather than revolving. The total of all available credit on business credit cards goes toward this “pooled” amount as well. Credit cards can help protect your business, as they may limit exposure with online purchases. In addition, most have fraud protocols that can help protect you from having to pay for fraudulent charges. In contrast, using a debit card leaves very few options for recovery.

Money Management Tools

Managing funds can be overwhelming. There are a number of tools that can help streamline the process. These include companies like Brex, Divvy, Expensify, Ramp, and Lola.

Obviously, it is useful to choose a tool that also helps build business credit. There are not a lot that will do this, but some will.

Brex Business Money Management System

Brex integrates with your company’s existing accounting software. It allows for expense tracking, helps pay bills, and offers more control over spending.

The easiest way to use Brex is to open a Brex Cash account. Everyone with a Brex cash account gets a corporate card that works just like a debit card. It draws from your Brex Cash balance daily as you spend, then reports those draws as payments to Dun & Bradstreet, helping build your business credit score.

Since the Brex cash account balance is the security and the limit, there is no underwriting. They also offer a more traditional card with limits that can go up to 20x higher than that of typical corporate cards. They base approval and credit limits for this card on business financial information, including available cash, spending patterns, and more.

The entire balance will be paid monthly, so it is more like net financing than the cash card, but more flexible as well.

You can get cards for your team members and set individual spending limits, which helps manage spending.  There are also virtual card options for online spending.

Divvy

Another option that helps build business credit is Divvy. It is similar to Brex with just a few differences. For example, Brex charges $5 per card for additional cards except premium accounts, which get unlimited cards. Divvy offers unlimited free cards. Other differences include:

Other options for money management tools include Ramp, Lola, and Expensify. They each offer a number of benefits with various pricing options, but at this point they do not report to the business credit reporting agencies.

Business Cashflow Management is Vital, Especially When Inflation is Rising

If you do not manage cash flow, you are doomed from the start. Even if you have all the profit in the world, you cannot survive without cash. Having access to a cash pool is helpful when interest rates and prices are rising. Wondering how to start building a cash flow pool for your business. The answer is to sign up for a free business finance assessment with a Credit Suite expert today!

The post How Crucial is Business Cashflow Management to Surviving Inflation? appeared first on Credit Suite.

Crucial Events Of The Stock Market Timeline

Crucial Events Of The Stock Market Timeline

A thorough securities market timeline would possibly require to be performed in quantities. In the following numerous hundred words I will certainly try to describe essential occasions of the stock exchange timeline you may desire to called a basic inquisitiveness.

Our securities market timeline starts in 1790, with the federal government issuance of $80 million in U.S. bonds.

In 1792, there are 2 federal government bonds and also 3 financial institution supplies traded for a total amount of 5 protections.

Our securities market timeline relocates right into the 1800s with federal government bonds, financial institution supplies, as well as insurance coverage supplies trading after the War of 1812.

In 1817, a constitution as well as guidelines are created for doing supply profession. Right now, the New York Stock as well as Exchange Board is officially arranged.

Our securities market timeline currently relocates us to the opening of the Erie Canal in 1825, when New York State bonds are released to money the building.

In 1850 the shares quantity gets to 8500, which stands for a fifty-fold boost in just 7 years.

In 1836, the NYS&EB forbids it subscription from trading supplies in the road.

Throughout the panic of 1857, the Ohio Life Insurance as well as count on Company collapses as well as the marketplace recognizes a 45% given that the beginning of the year.

In 1863, the New York Stock and also Exchange Board comes to be the New York Stock Exchange.

In 1903, the New York Stock Exchange and also our securities market timeline step right into the twentieth century. The stock exchange commemorates this by transferring to its present home at 18 Broad Street.

Among one of the most notable events of our stock exchange timeline is the panic of 1907, throughout which troubles at Knickerbocker Trust trigger a work on all the city financial institutions. J. P. Morgan enters as well as bolster funds as well as finishes the work on the financial institutions.

The Federal Reserve is developed in 1913.

The stock exchange timeline sees Wall Street end up being the financial investment funding of the globe, replacing London at the end of World War I.

A 23-storey workplace tower with extra trading area is constructed beside the initial framework.

In 1923, a historical advancing market run starts that will certainly extend our securities market timeline for a lot of the following 6 years.

Black Thursday begins the securities market timeline on Thursday, October 24, 1919 when supply rates drop greatly on a document quantity of 13 million shares.

The securities market timeline has its most critical day on Tuesday, October 29, 1929, when the stock exchange accidents and also notes the begin of The Great Depression.

In 1990, 10 years prior to our stock exchange timeline brings us right into the 21st century, greater than 50 million Americans very own supply.

On May 17, 1992, our securities market timeline notes both a century wedding anniversary of the NYSE.

On October 27, 1997, the Dow Jones collisions 554 factors and also sets off the very first breaker security that shuts the NYSE at 3:30 PM.

Our securities market timeline relocates us right into the 21st century in which we experience several of the most awful economic times because our securities market timeline left the Great Depression. We have actually currently been presented to federal government financial institution bailouts as well as taxpayer-owned firms. Just time will certainly inform where out stock exchange timeline takes us next off.

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