After eliminating the consequences of the breakup, think about how to avoid repeating this situation in the future.
Analyze the cash gap
Figure out why exactly it happened: maybe there are extra costs In order not to worry about or problems with receiving payment somewhere. Once you figure out the exact reasons, you can solve the problem.
Reduce operating costs
Review what the company’s money is spent on. Perhaps some expenses can be eliminated to prevent a gap in the future: for example, changing the supplier of materials, reducing the number of events for employees, etc.
Create a safety cushion
In order not to worry about possible cash flow gaps, it makes sense to save money for sudden needs. For stability, it is enough to have a financial cushion to cover at least 2-3 monthly operating expenses. This will allow you to cover all obligations in the event of a cash flow gap and understand the reasons for its occurrence without tight deadlines and possible problems. It may take about a year or two to accumulate a safety cushion of this size, depending on how much you put aside from your monthly profit in a separate account “for emergency situations.”
Plan your income and expenses carefully
Careful planning will help you avoid not only cash flow gaps, but also other financial problems. For example, it is definitely worth taking the following steps:
- Calculate the minimum level of cash balance that will prevent a cash gap.
- Note which sources of income are critical to achieving it: eritrea business email list then, if you lose them, you will immediately be able to predict the gap and begin looking for ways to eliminate it.
- Describe when and in what amount you make payments. Also describe possible receipts, if you can predict them, or indicate the expected amount of profit based on statistics.
You can also use a formula or a table for calculating the size of the cash gap: update the numbers in it weekly to see possible problems in advance and find a way out.
Prioritize your essential payments
This method will not help to completely protect against a last year, it was posted In order not to worry about cash flow gap, but it will make its consequences less destructive: you will know exactly what you can temporarily give up in order to eliminate the problem.
List all the “operating” items that are on your budget, and then think about how important each payment is. Give each operation a priority – for example, from 1 to 5.
- 1 – the most important payments: their delay will entail serious consequences (fines, loss of personnel, inspections by government agencies, etc.). For example, loan payments, salaries and taxes.
- 2 – operations that affect business management. Their delay may lead to downtime and reduced productivity (purchase of goods, payment of rent).
- 3 – payments for additional costs of production and logistics (freight transportation, high-quality packaging, etc.).
- 4 – expenses that can be overdue for a short period without serious consequences (cleaning services for offices, additional training of employees, expansion of an advertising campaign, etc.).
- 5 – the least important expenses, the delay of which will have a minimal impact on the business (expenses on office supplies, gifts for employees, coffee, etc.).
Based on the list of priorities, distribute the available funds. Deal with the expenses for which there was not enough money after the fact – for example, you can postpone b2c fax the launch of a product in new packaging, reduce office maintenance costs, or cancel a corporate event until better times, but pay off debts to banks and cope with the obligations taken on without losing customers.
By the way, in the same way you can review prioritiesIn order not to worry about within each item. For example, delay a payment to a bank with the least penalties or pay salaries only to key employees, delaying it for a few days to less important departments.
If you cannot find the cause and come to a solution to the problem, seek help from professional consultants. After analysis, the expert will find shortcomings in financial accounting and give recommendations on what to fix.