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How much money will I need to keep monthly cash flow going?

If I bought a business with $581,000 in gross sales, cost of goods of $178,000 and $235,000 in expenses, how much cash would I need to come into the business and keep the cash flow going and maintain a good profit?
answered September 18, 2008|
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You're way off. Cash flow is about flow and timing: Factors like how fast you pay and how fast you get paid are vital, but you know nothing of that by just knowing the sales, costs and expenses.

I've done a 20-minute free video for you, online, that will explain how cash flow works. Please take a look at http://timberry.com/videos/. It's vital, too. Take the time to get this right, or bring on a team member, because cash is what runs your business.
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Tim Berry is the president of Palo Alto Software Inc., based in Eugene, Ore., which produces business planning software. He is also the author of 3 Weeks to Startup and The Plan-As-You-Go Business Plan, published by Entrepreneur Press. Follow him on Twitter: @Timberry
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