Page 38 - Biz X Magazine - October 2015 Edition
P. 38
SMALL
BUSINESS Small Business Is Big Business!
ADVICE
O ctober is “Small Business Month” in you succeed in business too! We hope the your business keeps growing. You’re better
Canada. The focus on small business following article below gives you some off taking a term loan.
“As the year progresses, compare your
is sponsored and organized by the Business
Development Bank of Canada (BDC), with good advice on managing your finances. projections to actual results on a monthly
How To Improve Your Cash Flow
events bringing together entrepreneurs basis in order to understand the cause of
(and those who want to be) at conferences, Management variances – and react properly,” Gauthier
workshops, luncheons and trade fairs. Cash flow management can be one of the says. “For example, if sales are lower than
Small and medium-sized businesses are most complex challenges facing a business expected, you could cut expenses, delay
the cornerstone of the Canadian economy. owner. discretionary outlays or ask your suppliers
They account for 99.9% of all Canadian That’s because it takes place on several for some breathing room.”
companies and employ close to 90% of levels at once – everything from accounts Investigating the cause of variances will
private sector workers. The BDC believes receivable and payable to inventory and help you zero in on where things are going
this contribution deserves to be celebrated. expense control, to even bigger questions off the rails and how to get back on track.
They also believe entrepreneurs need about your business model.
Pro
support in building successful, innovative “Good cash flow management starts it Margins Often The Culprit
businesses. with making financial projections and then Poor profit margins can quickly lead to
For 36 years, the Business Development closely monitoring your actual financial cash flow problems. Entrepreneurs often fail
Bank of Canada has organized “BDC Small results,” says Sophie Gauthier, Director, to account for all overhead costs or simply
Business Week,” during this special month, Business Restructuring Unit at the Business charge too little for their products or services
in recognition of the contributions and Development Bank of Canada (BDC). to produce an acceptable level of profit.
achievements of Canada’s entrepreneurs. “To prepare financial projections, you
This year, “BDC Small Business Week” should first think about your plans for
5 Steps To Better Cash Flow Management
takes place October 18 to 24 under the the coming year – especially big-ticket 1. Collect receivables as quickly as
theme: KNOCK DOWN BARRIERS. DARE expenditures such as buying equipment or possible, even if you have to offer customers
TO GROW. acquiring a business,” she adds. “Based on a small discount.
Daring to grow is never an easy task. these plans, you should then come up with 2. Keep a close eye on your cash flow
Inevitably, there are barriers that need to a projected income statement, balance sheet through the month and compare month-
be knocked down as entrepreneurs navigate and monthly cash flow forecasts.” end and quarterly totals to projections.
the path to success. Confronting challenges Consider different scenarios (optimistic, 3. Use term loans, not working capital or
is essential if they want to play in today’s most likely, and pessimistic) so you can plan your line of credit, to pay for capital assets
competitive global environment. It is not for the impact of each. such as equipment, machinery or real estate
only about having the will, but also about projects.
having the tools and resources to do so, both Understand The Nature Of The Financing 4. Seek to extend payment terms, but
financial and non-financial. You Seek remember it takes two to tango. Work on
The BDC operates under a mission to Your projections should also indicate your improving your supplier relationships.
help businesses grow and succeed through financing requirements for the coming year. 5. Arrange financing ahead of time – not
flexible financing, business consulting and With those in hand, you can approach your when cash gets tight.
venture capital. They focus on small and bankers to arrange credit lines or term loans. To find out more about cash flow
medium-sized enterprises and provides It’s important to avoid the common management and read real-life entrepreneur
many articles on their site, BDC.ca, such mistake of trying to pay for longer-term stories, download your free copy of BDC’s
as the one printed here. At Biz X magazine assets with your everyday cash. This can eBook “Master your cash flow: A guide for
we always want to provide content to help lead to a cash shortage if revenues dip or entrepreneurs” available at BDC.ca.
38 BIZ X MAGAZINE • OCTOBER 2015
BizX2015OCT52.indd 38 2015-09-29 10:02 PM
BUSINESS Small Business Is Big Business!
ADVICE
O ctober is “Small Business Month” in you succeed in business too! We hope the your business keeps growing. You’re better
Canada. The focus on small business following article below gives you some off taking a term loan.
“As the year progresses, compare your
is sponsored and organized by the Business
Development Bank of Canada (BDC), with good advice on managing your finances. projections to actual results on a monthly
How To Improve Your Cash Flow
events bringing together entrepreneurs basis in order to understand the cause of
(and those who want to be) at conferences, Management variances – and react properly,” Gauthier
workshops, luncheons and trade fairs. Cash flow management can be one of the says. “For example, if sales are lower than
Small and medium-sized businesses are most complex challenges facing a business expected, you could cut expenses, delay
the cornerstone of the Canadian economy. owner. discretionary outlays or ask your suppliers
They account for 99.9% of all Canadian That’s because it takes place on several for some breathing room.”
companies and employ close to 90% of levels at once – everything from accounts Investigating the cause of variances will
private sector workers. The BDC believes receivable and payable to inventory and help you zero in on where things are going
this contribution deserves to be celebrated. expense control, to even bigger questions off the rails and how to get back on track.
They also believe entrepreneurs need about your business model.
Pro
support in building successful, innovative “Good cash flow management starts it Margins Often The Culprit
businesses. with making financial projections and then Poor profit margins can quickly lead to
For 36 years, the Business Development closely monitoring your actual financial cash flow problems. Entrepreneurs often fail
Bank of Canada has organized “BDC Small results,” says Sophie Gauthier, Director, to account for all overhead costs or simply
Business Week,” during this special month, Business Restructuring Unit at the Business charge too little for their products or services
in recognition of the contributions and Development Bank of Canada (BDC). to produce an acceptable level of profit.
achievements of Canada’s entrepreneurs. “To prepare financial projections, you
This year, “BDC Small Business Week” should first think about your plans for
5 Steps To Better Cash Flow Management
takes place October 18 to 24 under the the coming year – especially big-ticket 1. Collect receivables as quickly as
theme: KNOCK DOWN BARRIERS. DARE expenditures such as buying equipment or possible, even if you have to offer customers
TO GROW. acquiring a business,” she adds. “Based on a small discount.
Daring to grow is never an easy task. these plans, you should then come up with 2. Keep a close eye on your cash flow
Inevitably, there are barriers that need to a projected income statement, balance sheet through the month and compare month-
be knocked down as entrepreneurs navigate and monthly cash flow forecasts.” end and quarterly totals to projections.
the path to success. Confronting challenges Consider different scenarios (optimistic, 3. Use term loans, not working capital or
is essential if they want to play in today’s most likely, and pessimistic) so you can plan your line of credit, to pay for capital assets
competitive global environment. It is not for the impact of each. such as equipment, machinery or real estate
only about having the will, but also about projects.
having the tools and resources to do so, both Understand The Nature Of The Financing 4. Seek to extend payment terms, but
financial and non-financial. You Seek remember it takes two to tango. Work on
The BDC operates under a mission to Your projections should also indicate your improving your supplier relationships.
help businesses grow and succeed through financing requirements for the coming year. 5. Arrange financing ahead of time – not
flexible financing, business consulting and With those in hand, you can approach your when cash gets tight.
venture capital. They focus on small and bankers to arrange credit lines or term loans. To find out more about cash flow
medium-sized enterprises and provides It’s important to avoid the common management and read real-life entrepreneur
many articles on their site, BDC.ca, such mistake of trying to pay for longer-term stories, download your free copy of BDC’s
as the one printed here. At Biz X magazine assets with your everyday cash. This can eBook “Master your cash flow: A guide for
we always want to provide content to help lead to a cash shortage if revenues dip or entrepreneurs” available at BDC.ca.
38 BIZ X MAGAZINE • OCTOBER 2015
BizX2015OCT52.indd 38 2015-09-29 10:02 PM
