Cash Flow Scenarios
Understanding Ecommerce Cash Flow
Sam Walderman grew his one-man consultancy business (Goodz) into a 5-person agency, all while owning and operating his own ecommerce business, Iluminación Vintage. We interviewed him and learned about:
- How cash flow affects hiring decisions
- Why he chose a revenue model that covers basic costs and incentivizes positive results
- Why he believes monitoring cash flow for ecommerce agencies and sellers is critical
Click here to learn tips from Sam’s experience.
Trying to Raise Funding?
Investor funding can take your business to the next level. But it's not for everyone. Learn how Afrocenchix founders Rachael Corson and Joycelyn Mate approached raising cash in this Forbes article by Jodi Cook.
Their advice?
“Be proactive when raising. Waiting for others to act is time wasted. Make sure you are consistently driving forward.”
Learn more here.
5 Strategies for Positive Cash Flow
The best way to avoid cash flow issues is to actively prevent them. Check out these 5 tips from the team at Growth Force:
- Forecast cash flow (You use Pulse for that 😉)
- Collect accurate data
- Receive payments faster
- Find or negotiate payment terms
- Optimize pricing
Check out the details here.
Pulse Q&A
🤔 How much should you save in your emergency cash reserves?
You should always have an emergency cash reserve to prepare for unexpected expenses.
🙋 If you want a simple answer, shoot for 3-6 months of operating expenses.
Some businesses survive on less. A lot of them do. So don't be hard on yourself. Set this as a goal, give yourself a couple of years to get there.
Ultimately, you need to figure out what makes sense for your business. You'll need to consider all sorts of factors, and every business is different.
For example, a web design agency has different operating capital needs than a wholesaler or a manufacturing business. A business with big one-time payments for projects needs more cash on hand to survive the lean months than a business with a steady stream of recurring revenue from software licenses.
No matter what your business is, Pulse can help you visualize what would happen if you lost a revenue source. Using built-in reports, you can toggle off existing income items to see how it would affect your Cash on Hand.
Use this to prepare your business for anything.
Looking for more cash flow content?
Here are some links we think are worth your time:
- 3 Reasons Why You Should Still Consider Crypto for Your Small Business
- SBA to Simplify PPP Loan Forgiveness for Smallest Borrowers
- The Pandemic Drives Cofounders to Couples Therapy
- What ‘Shooting For The Stars’ Actually Means for Business Growth And Sustainability
- 5 Cash Flow Tips for Freelancers
- 3 Tips To Improve Cash Flow For Your Landscaping Business
Trivia Answer
“At the end of my life, will I regret not having done this?”
✅ It's a simple approach called The Regret Minimization Framework. And, yes, Jeff Bezos credits it for his decision to launch Amazon. We're guessing he has no regrets.
Learn how it works here.
See you next month!
As always, your success is our top priority. Be sure to reach out to support@pulseapp.com if you need help with anything.
By the way, we're now using Curated.co to send this newsletter. It's part of the Simple Focus Software portfolio. Let us know if you like the new look.
Best,