A healthy cash flow is the lifeblood of any small business, and knowing how to manage the businesses cash can be the difference between success and failure. The often quoted phrase, ‘Revenue is vanity, profit is sanity but cash is reality” certainly says it all in 10 words. Having ample cash on hand will ensure that suppliers, employees and others can be paid on time. Understanding your numbers will allow you to make informed decisions quickly when an opportunity comes up that can translate to increased revenue and profit.

Cash management can be as simple as a cash flow spread sheet that monitors the movement of cash into or out of a business, matching outlays of cash with money owed to your business. As a small business owner, you must keep a record of all payments, bank statements, bills from all customer sales, vendor and supplier purchases, items received and checks disbursed-including payroll.

Bookkeeping may seem mundane but it is essential to keep track of the cash that is going in and out of your business. If keeping the books up to date is not your strength, find a professional who will ensure you stay up to date with all GST and payroll submissions, as well as, all regular tax filings.

As an added bonus, a professional bookkeeper can have all the information ready for a seamless transfer to your accountant for year-end filings; your accountant will be able to offer advice on anything you should be doing to keep your business fiscally healthy. Best of all, a professional can take care of the books and you can do what you do best whether it’s sales, marketing or management.

Making more than your business is spending? That is good. Is your cash flow regularly edging into the red? Not so good! It’s time to get some help. All it takes are a few smart moves to bring your business into the black.

Jolynn Green is Executive Director of Community Futures Central Island. You can count on us for sound practical advice, personalized business coaching and tailored financing that supports your business goals. Jolynn can be reached at ed@cfnanaimo.org or 250-591-7499