5 Dangers to Avoid when Managing Cash Flow

June 12 2015   11 AM  

Managing cashflow and fluctuating staff demands in business

The busier I get, the less cash I seem to have in the bank. Cash flow management is one of the most important aspects to running a small construction business and due to it’s unpredictable nature, it’s also the most challenging. Here are 5 key dangers to watch out for to reduce your risks:

  1. Staffing - having too few and you can’t complete the work on time but taking on too many and your payroll will become bigger than your income
  2. Underpricing Jobs – read our tips to avoid that here
  3. Bad payment terms – Outgoings need to be paid on time or you get penalized, so make sure you consider this when setting your own payment terms
  4. Financing assets out of cash flow instead of being financed over the useful life of the asset – Vans, Utes, Tippers, Equipment, Office Computers – give this careful consideration
  5. Bad debtor management – don’t get over reliant on one contractor, sadly, contractors are going bust everyday so you must cover yourself & always prepare for the worst

ConX is here to work with your fluctuating labor demands, so you staff your business as needed. Register today to access a pool of tradespeople ready to work.

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