Three start-ups explain how cashflow works in their business

We spoke to three founders to find out how money flows in and out of their business and how you can ensure you've always got enough working capital

Every type of business has a slightly different looking cashflow cycle. You might sell products, in which case you’ll need to design and commission a manufacturer, wait for the product to be supplied, while delivering it to stockists or selling online.

It may be months between an order being made and receiving payment, yet you’ll still have bills, staff and suppliers to pay. Knowing you have enough working capital to hand is crucial.

So, as a business owner you’ll need to seek to find patterns and put in place systems that ensure you never run out of cash. It can be a headache and is often the cause of early stage companies going bust.

Which is why we spoke to three start-up founders to find out what the flow of money in and out of their business actually looks like, so that new business owners might build a picture of how they can handle their finances each month.

You’ll hear from Nelson Sivalingam, founder of lifestyle membership service Wonderush.com, Lorna Syson, founder of a high-end textile company bearing her own name, and Neil Westwood, founder Magic Whiteboard, the portable whiteboard on a roll which came to the public’s attention on Dragons’ Den.

This film was produced in partnership with Sage One. For more business insight and tips to keep on top of cashflow and small business tax visit the Sage business blog http://uk.sageone.com/blog/.  

For a free trial of Sage One please visit http://uk.sageone.com/products/.

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