What is cash flow? Tips for Buying a Business
You need to know the cash flow of a business BEFORE you buy it.
Let’s break it down. Cash flow in business is simply money coming in and going out. It’s money made and money paid out.
Remember, the aim of any business is more money in than out.
But how is cash flow calculated? It’s as simple as a list of the money paid in and the money paid out to. You’ll use this to know if the business you’re interested in is profiting or not.
The cash flow should include:
- Sales
- Utilities
- Deductions
- Salaries
- Taxes
⚠️ Caution: Big sales do not always mean big profits, and getting a profit after paying bills is not the whole story.
Know the numbers, and understand how the business is performing.
If you want help with that, we give businesses clear and simple pricing and advice to help you surge your business success. Get a free quote or ask a question. Contact today!
