43: Cash Flow Tips to Keep Your Business Afloat

Are you ignoring the warning signs that your business might be on the brink of insolvency? You’re not alone. We have the tips you need to steer your business out of troubled waters.

In this episode, Sally dives deep into one of the most pressing concerns facing businesses today — cash flow management and the alarming rise of company insolvencies in Australia. She breaks down the latest statistics from ASIC, revealing the sobering reality of the current business climate. 

Whether your business is teetering on the edge or you want to ensure your operations stay afloat, this episode is packed with actionable advice on cash flow forecasting, managing accounts receivable and payable, budgeting, and recognising the early warning signs of insolvency.

Sally doesn’t just present the problem — she offers a clear, step-by-step guide on how to forecast cash flow weekly, enforce strict payment terms, and avoid common pitfalls like using the ATO as a bank. With practical strategies to optimise revenue and manage costs, this episode is a must-listen for any business owner looking to safeguard their financial future.

In this episode of Smarten Up! The Tax and Business Podcast, you'll learn:

• Startling ASIC statistics on company insolvency (00:18)
• The top 3 paths to insolvency: voluntary liquidation, court-ordered liquidation, and voluntary administration (02:10)
• The technical definition of insolvency and what it means for your business when debts are overdue (04:06)
• Red flags business owners should look out for before it's too late (04:36)
• Cash flow forecasting dos and don’ts (08:04)
• Managing your accounts receivable and how to ensure you get paid on time (09:38)
• Managing your accounts payable and the importance of setting aside funds (13:43)
• How to budget for business expenses and make tough decisions about cutting costs when revenue dips (17:55)
• The balance between pricing increases and customer retention (21:25)
• When and why you should rely on internal funds or finance assets, and the danger of using external finance for cash flow (25:46)
• Why you should seek expert advice and not stick your head in the sand when facing potential insolvency (28:19)

This episode is a critical wake-up call for business owners to be proactive in managing their cash flow and recognising the signs of financial trouble. Remember, you’re not alone — thousands of businesses are facing the same challenges. Stay smart, stay informed, and always reach out for help when needed!

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