From The MSM Archives: Go With The (Cash) Flow Controlling Income And Expenses

    0
    4

    The irony of business management is that an enterprise can be profitable and still have poor cash flow. It’s possible to show a surge of profits on a monthly or even yearly basis and yet face a significant money squeeze throughout the year. Late-paying tenants, unexpected expenses, and a host of other events can all conspire against cash flow.

    Cash flow charts the movement of money in and out of a business and when that movement takes place. Inflow, the movement of money into cash flow, includes cash collected from sales, collections on accounts receivable, and proceeds from bank loans or other types of loans. Outflow, the movement of money out of a business, may include purchasing fixed assets, paying back loans, and paying accounts payable.

    How important is cash flow to the effective operation of a self-storage business? “In real estate, net operating income on a day-to-day basis is not as important as cash flow,” says Greg Kreizenbeck, principal of Phoenix, Ariz.-based Pacific Land & Investment. “Without cash flow, you’re into your own personal bank accounts to fund deficiencies.”

    Click Here to Read More….

    ]]>

    LEAVE A REPLY

    Please enter your comment!
    Please enter your name here