If you want your business to grow and thrive, you need to be fully immersed in documenting and maintaining your cashflow. Staying in the black and keeping debt levels to a minimum is essential for new start-up companies and well-established global brands.
Staying current with the daily cash input and output can be a full-time job in itself. You may have considered bringing in a full-time employee to manage this on your behalf; however, that is another costly outgoing that will impact your cashflow.
At Gravitate Accounting, we have various packages to choose from, depending on what you are looking for from a partnership with us.
We are also adept at managing your books and understanding your budget to ensure a healthy cashflow. We can use our analysis to ascertain areas to pull back and invest more heavily to increase revenue and help your business grow.
We believe in teamwork, and as part of your team, we will do everything we can to take the strain off you so that you can do what you do best: run your business.
"The work that Gravitate have done within our business in a short space of time has totally transformed how we operate financially. Their expertise, knowledge and dedication to automation means that we now have efficient and sophisticated systems in place to ensure we can maximise the companies commercial potential. I can't thank Mike, Sam and the rest of the Gravitate team enough for their work within the business and willingness to engage with us on a daily basis"
While both are essential to business operations, there is a difference between budget and cashflow.Budget refers to an overview of the income and outgoings you expect to see over the course of a year. Businesses use it to ensure they don’t have more money going out of the company than coming into it.Whereas cashflow is much more granular, specifying when a business’ funds are expected to move. Cashflow forecasting can also help a business decide whether they need to apply for financial support and how these loans will be paid in full if that route is taken.
There are four types of budgeting techniques businesses use to keep on top of their finances:
Incremental budgeting: This is the most popular choice, as it is simple and straightforward. Using last year’s financial figures, you’ll add or subtract a percentage to ascertain what the budget should be for the coming year.
Zero-based budgeting: This is another popular method and operates with a ‘fresh start’ approach. Just because one department had a specific budget approved last year doesn’t mean it will be approved this year. All budgets must be essential to business success.
Activity-based budgeting: With this method, a business will set a revenue target and then calculate how much they need to spend to reach that target.
Value proposition budgeting: This type of budgeting is less revenue-focused than an activity-based approach. Instead, all budgets must have clear evidence that they provide value to the business before they are approved.When you speak with Mike Crocker, he will advise which approach may be the best option for your business.
Mike Crocker can offer some advice on how to improve your business’ cashflow after gathering some initial information from you; however, some general improvements include:
-Ensuring your receivables are submitted ahead of your payables going out.
-Analysing your product offering, pulling back on any products that aren’t selling, and investing more heavily in popular products that return a higher revenue.
- Using cloud-based accounting software for live information on your financial position at all times.