Ask new small business owners in Canada what their biggest worry is, and half will tell you it’s cash flow unpredictability, the most recent American Express Small Business Monitor found.
Cash flow is particularly challenging for new business owners, largely because they can’t always get access to conventional credit and financing, says Paul Roman, vice-president, small business services for American Express Canada. “At the same time, they really need both longer- and shorter-term financing options to stay ahead.”
Roman offers the following advice to help startups keep the cash flowing:
Be prepared for unforeseen expenses. An equipment repair or unexpected large contract could put a big strain on cash flow. Make sure you have sources of flexible capital to address whatever might come up.
Monitor your cash. “It’s easy to think about driving top line results or pricing, but business owners often don’t draw the parallels to cash in a formal way,” Roman says.
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