What rocks are impeding the flow of water (cash) in your business?
If you have travelled on an airplane, you’ve heard the steward or stewardess say to “put your own mask on first before helping others.” Oxygen is immensely important to the function of our minds and our bodies. Executives, in particular, need to take care of their body, minds, and souls to avoid outbursts. I know first hand, and recall the times I reached my limit and then had to profusely apologize.
I would argue that cash is to our businesses as oxygen is to us humans. I can think of 7 ways water can progress:
- Trickle
- Flood
- Slow and Steady Flow
- Calm
- Rapid
- Turbulent
- Wavey
I’ll bet you recognize times cash has flowed in your own business in these ways. Chances are good you also know of other business that have suffered from cash flow issues—one you own a stake in even if it is public, and one that you have heard of in the news or from a companion in your industry.
I wondered where EOS, the Entrepreneur Operating System, and some others got this term for problems in business. You’ve probably learned about the glass that was half filled with water. Some considered it half empty, some half full, and some considered it completely full with 1/2 water and 1/2 air. There is a similar image of how to fill a glass. It’s captured well in this 4-minute YouTube video. I don’t know about you, but I’m learning to save time by listening and watching such items at 1.5x or 2x speed.
- With inventories rising as a response to supply chain issues;
- With clients paying more slowly to manage their own cash flow;
- With suppliers either offering incentives to pay early or demanding cash on delivery (COD) or worse, cash on order (COO);
- With interest rates for small business no longer at historically low levels;
It’s more important than it has been in years to pay close attention and manage the cash flow in your business.
Just don’t cash out yet!
