VIDEO: How can you discover your cash flow story?

DISCOVER YOUR CASH FLOW STORY

What does your cash flow story tell you? Is it a story of abundance? Peril? Sufficiency? In my short video below, I discuss a simple, yet powerful concept called "the Power of One," that if implemented on a quarterly basis, can impact your cash flow and help you achieve your goals. 

WANT TO KNOW HOW "THE POWER OF ONE" CAN IMPACT YOUR CASH FLOW? Contact me to learn how to implement this strategy in your company.  

Transcript

Rob Lynch here, I get asked questions daily from business owners so I started this video series called “Ask Rob” to share some of them.

Today’s question is “Do you know what your cash flow story is telling you? Is it a story of abundance or is it a story of peril or is it a story of sufficiency?"

I once heard Alan Milt’s say, revenue is vanity, profit is sanity and cash is king. More on Alan in a moment. How do we discover what our cash flow story is, where do we look for clues? A lot of people don’t understand cash flow.

Now Alan is the co-founder of a company called “Cash Flow Story” and they developed a simple, yet powerful concept called the Power of One. The Power of One is what do the 1% changes or the one day changes do to our cash and our profit.

There are seven levers in a business so, what if you were to increase your prices by 1%, what impact would that have on cash and on profit, what would a 1% increase in sales volume have? Would it have a positive effect on cash and profit or negative effect? Some businesses are not aware that for every dollar of volume they bring into the business it has a negative impact.

What if you decreased your cost of goods sold by 1% or what if you decrease your overhead by 1%? How would that impact cash and profit or what would the impact be if you paid your payables one day later or you collected your receivables one day sooner? And what would be the impact if you reduced your inventory days or if you’re in the services business your work in progress days by 1%? These are the seven levers in a business.

Companies should be having Power of One discussions on a quarterly basis. How much additional cash do you want to make and how many Power of One changes do you need to be making to achieve that goal?

Contact me if you’re interested to see how The Power of One can impact your cash flow story. Thank you.