Opportunities to Increase Cash Flow
I was brought up with the saying “Make hay when the sun shines” and perhaps that is a reflection of why I loved the wheat fields of the prairies in Canada, but that’s another story.
I’ve recently found myself quoting those words when opportunities to do more work have come my way. Knowing that for me the more work I do, the more money I make. I can increase the stash of cash I have to cover me through the potentially tougher months ahead.
I work with a select group of clients as their part-time CFO providing management reports and strategy. But I have a couple of clients whose businesses have already or are terminating in the next month which means that I’ve lost a significant chunk of my income.
I thought, ok, now I’ve got the time to focus on rolling out my online programs and promote to the wider business community. I signed up for more training and committed to four major training events from May to July. And yes, I do have one major training or mentoring program running each year to continue to up-skill myself. So that wasn’t anything new. What was different was my decision to cram so much into those three months.
But then the opportunities for more work started to come my way and I thought “Make hay while the sun shines” and said yes.
The result, I’ve massively overloaded myself. I’m juggling client work with my training and working 7 days a week. Ok, so I’ll confess that I usually do work on weekends, but now the pressure is on. No longer is it a case of working on my business on the weekends, now it’s doing client work and some how trying to jam in my creative thinking time around spreadsheets.
I can tell you that creativity doesn’t flow easily when your head is full of complex spreadsheets. At least, mine doesn’t.
So whilst the good news has been that the cash flow hasn’t been impacted too badly through the past few months, it may be a different story for the next few months. And whilst I’ve been busy doing the client work, opportunities to build the online side of my business have been missed.
When opportunities come your way, do you think “make hay while the sun shines” and seriously consider whether the opportunity is one that will make profit and provide cash flow? Or if the opportunity is out of the usual scope of your business, do you say no? Do you choose to stay focused on your core business?
There’s no right or wrong answer. If the opportunity provides work for your staff and is profitable, then perhaps you should consider it. The key here is that it must be profitable. That way it is helping to pay your overhead costs. Even if you’re still losing money overall, you’ll be losing less money than if you didn’t take up the opportunity.
Knowing your numbers and how much you need to make each week or month to cover your costs is vital. It helps with making decisions on whether an opportunity is worth taking on or not.
But remember that if an opportunity is good, it will help to reduce your losses during these times. It will also minimise the impact of your bank balance or the need for additional funding to support your business.
Find out where the pressure is in your business
The Business Barometer will measure your business finances across three critical areas: Core Concepts, Focused Management and Planned Growth.
