Avoiding A Cashflow Crunch - Page 2 of 2

Avoiding A Cashflow Crunch

in sales and are optimistic that this plan is going to produce results, don’t forecast huge improvements in revenues until you start to see sales pick up.

Once you’ve completed the calculations for cash flow projections, examine the numbers and ask yourself if the numbers make sense. “I call this the smell test,” says Campbell. “For example, if the numbers are telling you that you can spend some money, and you know it just does not seem right, step back from the numbers and see if there’s an error. There may be an error in the calculations or the assumptions.”