I am being asked where we begin?
What are the first steps?
Here are a few broad guidelines…
Prepare a zero Revenue Budget
1. Prepare a budget assuming no Revenue
2. This forces you to focus on every cost
Rebuild the Revenue budget
1. Group customers with similar characteristics
b. Payment profile
2. Understand the cost drivers
3. Extrapolate the revenue into a cash flow budget
Merge the two budgets…
1. Work on a realistic cash flow
a. Being conservative is as bad as being over optimistic
2. Look at your available funding lines
3. Determine the cash burn rate
a. How long are we sustainable for.
4. What are the levels that would cause you to;
a. Shut up Shop
b. Invest more personal funds
Monitor your cash flow daily!!!