Whats the connection between
your cash flow and productivity ?

Making the connection between cash flow and productivity in business and personal finances.

Like it or not your cash flow and productivity are linked. Cash flow problems are a major headache. This is one obstacle that hits a lot of business at some point during their operation. Having financial struggles can be detrimental to the business itself and it can affect morale negatively, too.

Cash flow problems can be caused by the current economy, poor money management, not enough marketing, too much overhead and a lack of customer response for the product that you're offering.

It can be difficult to want to keep on going when you’re facing cash flow obstacles. But what you have to do at this point is to remember what your dream was in the beginning.

Don’t lose focus during the hard times. So often, a business will go through a rough patch financially - only to turn around in the blink of an eye. Yet too many business owners get so discouraged with the lack of cash flow and productivity goes down as well.

This slowed productivity then affects the overall business, which contributes to the cash flow problem. There are short-term and then there are long-term cash flow problems.

Short-term cash flow problems can creep up on you suddenly - and sometimes without warning. For example, you could have a big customer account that brings in thousands of dollars a month and suddenly, the customer notifies you that he won’t be needing the services your company offers anymore.

So just like that, your profit is slashed. If the obstacle is a short-term cash flow and productivity can be shifted to another money making project for a short time- go for it. Then you can turn this around in a short amount of time. And all you had to do was pick up some easy jobs that your company can do to bring in money.

This type of creative thinking allows you to meet cash flow and productivity at the same time, but by reassigning your efforts and thinking outside the box. 

The faster you can bring in the money, the quicker you’ll solve your cash flow problems. If you’re used to making $300 an hour consulting for businesses, cut your price by a percentage.

You could bring in several smaller companies or individuals who couldn’t afford your services at the higher rate. Running a special to give our business an injection of cash helps you survive during the next planning phase.

Long-term cash flow problems are a bigger obstacle to keep your productivity on track with. When you have this kind of financial issue, it can lead to a lack of supplies, not having enough to pay yourself or your employees and struggles to pay your typical overhead expenses.

Usually, long-term cash flow obstacles do indicate that your business is headed that way before they become an issue. You might notice that invoices aren’t being paid on time.

If you allow other companies or individuals to pay you in arrears, several slow payers could hurt your business. If this is the case, then you would need to cut off the company having access to your services until the debt was settled.

Never risk your business’s viability over someone else’s lack of responsibility. Take care of the matter and if necessary, replace a slow or non paying client with someone who is reliable.

...cash flow and productivity go together like hand and glove...think outside the box...

Every business will always have an area where there’s a money drain. Go over every section carefully to see where you can cut costs. If necessary, have a mentor look over your day-to-day business operations and make suggestions.

If you’re a start up business and cash flow is an obstacle because you don’t have any at all, then barter what services you do have to get what you need. It’s also a good idea to consider working on other cash-generating ideas like freelancing or an offline job if you need money to pursue your dreams.

Low cash flow doesn't have to mean low productivity.

Read Party I How To Become More Productive

Read Part II The Consequences of Ineffective Time Management

Read Part III Being A Productive Person


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