Thanksgiving is a time of year friends and family members gather to break bread (and turkey, mashed potatoes, stuffing, corn, etc.). We catch up with one another over conversations and football. We count our blessings and reflect upon our good fortunes.
For small business owners, one of those blessings may very well be healthy cash flow. After all, when the cash flow river dries up, things can get a little dicey for decision makers. On the other hand, healthy cash flow enables companies to direct enough resources to every initiative—and even push new campaigns forward altogether.
With that in mind, let’s take a look at five reasons you should be thankful for healthy cash flow this Thanksgiving season:
You can pay your bills without worrying. Instead of scrambling to figure out where you’ll get the money to cover wages, insurance, rent, utilities and other operating expenses, with more cash on hand, you’re given the peace of mind that comes with knowing the money you need is always within reach. This enables you to spend less time focusing on managing your finances and more time brainstorming new ideas and investing in mission-critical business functions.
You can hire more employees. With healthy cash flow, you’re able to hire more employees, ensuring that your existing staff doesn’t have too much on their plates and that the quality of their work remains consistent as your business grows. Remember, studies show that overworked employees are significantly less productive than their well-rested counterparts. So if you notice that your staff is having a hard time finishing their work every week, it might be time to increase headcount.
You can target new markets. Has your business been doing well? If so, you might want to leverage that positive momentum and devise ways to expand your operations. Cash on hand enables you to open new locations, design new products and target new markets without spreading yourself too thin. Once cash flow problems are solved, you’re able to grow your customer base thereby growing your business.
You can quickly respond to new opportunities. Let’s say you randomly get a phone call from an old colleague you trust who’s wondering whether your business is interested in partnering with his company for a new initiative. As it’s described, the deal seems almost too good to be true. Everything sounds great, except for the fact that you don’t have access to a whole lot of cash at that moment. So you have to pass. When your cash flow problems are solved, however, you don’t have to worry about stuttering when new opportunities materialize. Instead, you can respond swiftly.
You can pay down your debts. Healthy cash flow also gives you the resources necessary to pay down your debt ahead of time should you so choose. Just like it can in your personal life, debt can cripple your business—or at the very least help severely impede its progress. With more cash at your disposal, you’re able to pay down your debts. Depending on how much money you have, you may be able to slash the rates you borrowed at and reduce your monthly loan payments. Simply put, the less debt your company has to its name, the healthier your business is.
Some good news: If your business is struggling to maintain a healthy cash flow, all is not lost! You have more control over your cash flow than you may realize. Believe it or not, you may be able to solve your cash flow problems in a few simple steps.
From the whole team at Fundbox to you and yours, Happy Thanksgiving!