If your business needs a cashflow model then take two minutes to see how we go about building a simple, useful model and keep it going for as long as it’s helpful.
Press play and also use pause as there’s a lot to take in on some of the pages.
As you can see in the video, getting your bookkeeping up to date is an essential building block as is keeping it up to date.
At the start of the new month we update the cashflow model for the receipts and payments that occurred last month and make sure the closing balance in the cashflow model agrees to the reconciled bank balance(s) in the accounting software.
Then we discuss with the client what is likely to happen over the next three or four months.
The primary focus is on sales and payments by debtors. Then we look at the outgoings.
Only then can we see if there will be any problems to navigate, quarterly pinch points, and we can put solutions in place.
Forewarned is forearmed!
Pro tip: we rarely look beyond the next three or four months in the forecast. The sunlit uplands of a year down the line can take care of themselves but you won’t reach them if you can’t navigate the next three or four months.
Firstly, if you can measure something then you can improve it. So, simply having a cashflow model at all will focus attention on cashflow issues and how to solve them.
The areas to look at for improvement are typically:
All these measures can improve cashflow and you can see the effect of them very quickly.
Practice makes perfect. At the time of writing this blog, Molly’s cashflow model has been running for nine months.
The financial management of her business has improved beyond recognition and Molly has become very sure-footed at forecasting, managing and improving her cashflow and her profitability.
History can repeat itself. As time goes by you build up a month by month cashflow history which becomes ever more useful and is a great reference point, particularly for a seasonal business.
Quite simply, we know what to do and we can work with you to get your cashflow model in place very quickly, as well as bringing your bookkeeping up to the standard your business needs.
No bells, no whistles, no fancy graphs or apps – just a cashflow model that works for you.
Let’s have a free-of-charge chat about your business – call Michael Austin on 020 7125 0270 or email info@bluedotconsulting.co.uk
Michael
Related links:
Why two bank accounts are better than one
Chartered Accountants – Bedford House, Fulham Green, London, SW6 3JW
We don’t believe in forms, we believe in talking to people, finding out your needs and tailor-making a solution just for you.
Give us a ring on 020 7125 0270 or email us at info@bluedotconsulting.co.uk
“Michael and the Blue Dot team have been an essential part of our journey from startup through to being an established company, and we look forward to continuing working together long into the future. They have always been on hand to offer support and sound advice whenever it is needed.”
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Michael was fantastic. He quizzed me on how my business worked financially and was super patient with me. Explaining everything in a non-accountancy manner. He then showed me how to utilise all the less obvious tools in the program, which he continues to do, so that I can see immediately what monies held belonged to my company and what is held for clients. I now do my own VAT returns and payroll because of his help and continued support.”
“I really enjoy working with Blue Dot Consulting — they’ve helped me take control of our financial situation in a practical, no-nonsense way.
They take a common-sense approach and, most importantly, they get things done. For example, we now have weekly planning and forecasting calls, along with monthly cash flow reviews using simple, easy-to-understand spreadsheets.
Their support has made a huge difference in how we manage and plan for the future.”
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“Blue Dot have been our accountants and bookkeepers since the very beginning of our business, and have been nothing short of outstanding throughout.”
