The ability to balance cash received in a business wih the payment of bills as and when they fall due is a critical function in any business. Poor management of cash flow is often the primary reason for business failure! Lack of cash flow is causing difficulties for many profitable businesses.

A business can not function with out cash it is what makes the business function. Sales are the main source of cash for any business. A business owner can also source finance from bank loans, overdraft facilities, grant aid, invoice discounting or directors loans. Many business can operate without making a profit but will fail to survive without cash. Take time to look at your cash flow.

Check that you have sufficient cash flow to cover teh cost of placing a major new order of stock or taking on a new member of staff.

You must keep on top of your forecasts. It is vital that you do monthly forecasts - factoring in your monthly commitments e.g. wages, rent, rates (break down the annual figure over the year), supplier invoices, insurance (breakdown the annual figure over the year). Do compare and contrast exercise at the end of each month look at your forecasts against what actually happened and evaluate the results and adjust your forecast for the next month as necessary. This should become a routine exercise.

Managing the cash that comes into your business is key. Hold onto this cash for as long as possible and pay your bills wisely - take as long as you are allowed to pay your creditors being careful not to incurr late fees or interest charges. Keep a good realtionship with your supplier dont fall into arrears.

Monitoring the business on a monthly basis will help to identify danger signs and help you spot a problem early allowing you to do something about it before things get out of hand. Watch out for things such as: movement in sales up and down? Has amount of money due to suppliers increased? Do you have a healthy bank balance? What is your level of stock in relation to sales? Review costs and see where savings can be made.

Keep in contact with your accountant and your bank manager.

The Irish Hairdressers Federation provides support to its members please contact 056-8833808 for more information.

This year's Irish Hairdressing Championships were held on Sunday 7th March at the RDS, Dublin. The event was a great success with very high entries from all over the country. Here is what its all about we have provided an overview of each of the categories from this years competition.

IHC 2010