Cash

 

Cash is like the oxygen that fuels growth. With it your organization has a chance grow and prosper. Without it your organization will be stagnant or worse, cease to exist as an organization.

When Michael Dell was growing his company widely, he reached a point in the mid-90’s when he ran out of cash. He was GROWING BROKE, like so many other businesses do that scale up quickly. That’s when he brought in his CFO, Tom Meredith and calculated his cash conversion cycle to be 63 days. That meant it took Dell 63 days from the time Dell spent a dollar on anything until it flowed back into his company from accounts receivable into cash.

Focusing on a cash improvement strategy, Dell drove the cash conversion cycle from 63 days to a negative 21 days. This meant that Dell received a dollar 21 days BEFORE it had to be spent on anything. Without this improvement in cash, Dell would have faced the real possibility of ceasing to exist over time.

DO YOU KNOW YOUR CASH CONVERSION CYCLE?

DO YOU HAVE A STRATEGY TO IMPROVE YOUR CASH FLOW?

DO YOU PROJECT YOUR FUTURE CASH NEEDS AS PART OF YOUR LONG TERM STRATEGIC PLANNING PROCESS?

Contact Strategic Solutions Enterprise on how we can help you improve your cash flow to ensure you have a sufficient cash position to fuel your growth strategy.

Free Tool: Cash Conversion Cycle – CLICK HERE