Millions of people worldwide practice social distancing to stop the overall spread of Corona virus. Many companies experience or anticipate important constraints on both cash and working capital in particular liquidity challenges. Well experienced business people are aware the ever-increasing requirements for the cash flow scrutiny in the days and months ahead. Finance departments have the responsibility to manage the cash pressures during a crisis.
Consider important things at first
Almost every company nowadays sees the low revenue and gets less cash flow along with other problems like the delayed receivable collection and requirements to step up payables to leading suppliers. These companies expect to become much more nimble for the purpose of managing the inventory in the supply chain with maximum uncertainty and demands on working capital. This is worthwhile to follow the best guidance from experts to manage the cash and liquidity position in the business during the high uncertainty times.
As a business owner or administrator, you have to test the overall incoming and outgoing cash flows as comprehensive as possible at first. You can spend enough time to be aware of worst case financial scenarios as well as downsides such as the impact of foreign exchange on the overall cash position. This is because you must act in the measured way. If you know about the status of the cash and liquidity runaway in your business today, then you can estimate what changes your business get during the next three to four months.
A proper assessment …