1st January 2019
CASHFLOW Control in Business
Happy New Year everyone!
A long time ago, I was taught one very simple idea.
In business, it is about CASHFLOW CONTROL, it is not about the profit and loss. As an accountant, I have always thought it was profit and loss. Well it is about profit and loss but when operating a business, the finer details I need to learn is to have control over my cashflow.
CASHFLOW, though your profit and loss looks amazing, when your cash flow dries up, all the profit will mean nothing. It was a big learning experience, painful and crying times when I have to borrow money to roll over and bank loans. The banks do not stop calling for the interest on the overdrafts! How can one focus on sales and collections? This I learned from my first business, which I had to close down after a couple of years!
One of the biggest cash outflow always is ‘wages’, the second is the ‘rental’, it is not even the cost of goods sold, it is the rental, then the utilities such as electricty and water!
For this reason, the second business we started, we bought our own office.
You see, the rental keeps going up but if you buy the property, your installment is always the same, you have cash flow under control and then you can focus on the sales to bring in the profit.
Secondly, the property we bought as our office, the property price appreciated over time, the property, I am glad to say has tripled in price!
Lastly, there is no need to get permission to renovate the place because, we are the landlord, we can do anything to our property!
Be business wise, Better Buy own office than rent!
New Listing for your consideration at Stanmore, close to train station, bus stop and very close to Sydney CBD. http://www.oracodesrealty.com/sell.html
Have a great day, everyday!
Licence Real Estate Agent | Stock and Station Agent| Auctioneer | Strata Manager
Oracodes Realty Pty Ltd
Licence Real Estate Agent in NSW.