The Importance of Cash Flow

As with most businesses, cash flow is critical to ensure funds are available to meet your operating needs. Without effective cash flow management, a business faces several problem areas, such as cash shortages, inability to pay bills, bankruptcy, or even business failure.

Cash outflows and inflows each happen on their own cycles. Many times, cash inflows lag behind cash outflows, leaving your business short of money. This is known as a “cash flow gap.”  With a large cash flow gap, your outflow of cash may not be covered by a cash inflow for weeks, months, or even years.

Cash flow is one of the most vital elements in the survival of a business. It shows where a company may be headed. Instead of hoping everything will work out, you can enhance your cash flow with a FactorLine from Charter Capital.  When you can predict or even control your cash flow, you are in a much better position for continued business success. In today's "credit crunch" economy, Charter Capital is your alternative source for business financing.

Cash Flow Calculator

Many failed businesses are profitable when they go under. This calculator shows you how business-to-business sales, carrying inventory, and rapid growth can deplete cash (working capital). Change the variables and watch their impact on real business cash flow.

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