Originally Posted by cpllawncare
I totally agree, but if you didn't have 20,000 to start with it takes time to build up to that, I'm at about 10,000 now but 20 is my next goal. One problem is I have gone through a series of expansions in order to grow the business so I've let my balance get a tad low but I know when to put the brakes on and go back to building cash, funny thing is after each expansion the rebuilding process gets shorter and shorter because I now have expanded capabilities therefore can go after more profitable business.
yes it takes time but my point is NEVER deplete what's in the account.
come up with a certain dollar amount you will NOT go below and stick to no matter what.
businesses should never have to have each and every invoice paid on time each and every month to cover all expenses. you should be able to go a little bit without receiving a single cent from a client. now how long that time frame is will depend on how successful your business is and how successful you want it to be. but you certainly should NEED cash flow 12 months out of the year or NEED to convert from monthly invoicing to weekly invoicing to cover expenses.