What is cashfow?

[deepak]

I keep hearing the term cashflow in business discussions, but I’m not completely sure what it means. Can someone explain in simple terms what is cashflow and why it’s so important for a business?


Also, how do small businesses manage their cashflow effectively to avoid running into financial trouble? Any practical examples or tools you recommend?

 

[Gsusangrey]

The entire amount of money coming into (inflows) and going out of (outflows) your business during a given time period is known as cash flow. It is an essential indicator of the short-term viability of your business and its capacity to cover costs.

 

[niyati]

There is cash flow which is the coming and going of cash in or out of a business or a personal account. It depicts the amount of money generated and spent in terms of time. Positive cash flow indicates that a business is receiving more money as compared to spending money and it keeps the business afloat as well as finances the operation or expansion.