Owners of small and average business inevitably face a problem of choice priority direction monetary stream of business and appropriate supervision behind it.
The key to successful business consists in skill to hold the control over a monetary stream in company and effectively operate it. Is required coordination of 3 basic steps for successful management of monetary stream: escort, analysis and preparation of budget.
Analysis of movement of a stream
The analysis of delivery and outflow of money resources will enable to choose the most suitable decision for management of the capital. Analyzing inflows of monetary resources, it’s necessary study ways by means of which it’s possible influence monetary stream of company: on credit and account receivable.
Concerning predictability of outflow
For volumetric payments it’s possible find money resources from other resources. So, for the seasonal enterprises carry of payments on other month will accelerate a monetary stream during when the profit of the given enterprise decreases.
- Volumetric payments;
- Stale stocks;
- Inability to compete in their market segment because of absence money resources;
- The delayed debts;
- An excessive short-term duty;
Effective supervision of monetary stream will enable to avoid problem lacks and will help to support a positive monetary stream.
Preparation of budget company
Budget of movement money resources can help with planning the future growth and expansion of business. The basic budget of company should be so detailed, how much it’s necessary for carrying out of monthly subdivision of inflow and outflow of money resources to make forecasts for month, week and even day. On basis of analysis monetary stream, for the last period of time it’s possible consider the problem on modification in plan for next year.
To estimate the future monetary inflow, it’s necessary make forecast of sales for next year.
To predict outflow of the capital from company, at account of operational expenses and creditor debts, it’s necessary make sure in accuracy of their parameters. The they will be more precise, the it will be easier to predict lacks and to find the proper decision. About monetary outflow of company, analysis of financial history, demands of business will allow to project conservation of detailed records objectively.
Acceptance proved business-decisions today is impossible without carrying out of detailed analysis of monetary streams and business-budget as a whole. Successful management of monetary stream lays a firm basis profitableness and growth of business.