How Do you - The 6 Major Causes of Poor Cashflow

Cash flow problems are one of the main causes of business failure.

Some reasons why businesses run into cash flow problems are:

1. High debtors.
   Too many businesses offer too much credit to their customers so that even if sales have increased and debtors have increased, because of poor collection insufficient cash is flowing back into the business. If customers fail to pay you on time this can have a major impact on your cash flow, especially if the money owing is a significant amount. Keep firm control on the amount of money due by your debtors. Place emphasis on collecting those debts, rather than allowing them to build up to where your business suffers because of shortage of money.
   
   
2. High creditors.
   Many business owners feel that getting extended credit for the supplies they buy is good for the business. The problem is, having too many creditors can prove a fatal combination if you also offer large credit amounts to your own customers. Your cash flow will only benefit if you can collect money owing to you faster than paying out money owing by you to your creditors.
   
   
3. High borrowings....

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