Happy August – As always, I hope you are well.
Cash is the most important word for any business. Certainly, without a sale, nothing can happen. Expense management is a must. But without cash – and strong cash management – you can “make” all the money you want, but if doesn’t end up on the top right hand corner of the balance sheet, it is all for naught.
Cash management is vital for KEA Advisors. We forecast our cash flow on a monthly/quarterly and annual basis and work to identify areas where cash is “tied” up for our firm. Productivity, collections, and quality all are areas that we focus on to generate the strongest cash flow possible.
Cash management and identifying cash generation opportunities has always been the focal point of KEA’s services to our customers. The PROFIT calculation all revolves around the ability of the dealership to move assets “up” (from inventory to receivable to collected cash in the bank.” Our Total Absorption calculation involves expenses in the calculation – expense is an outflow of cash.
