MSP Finance: Mastering Cash Flow

If you liked doing financial management for small businesses, you would have made that your profession, not managed services. You run an MSP because you’re great at working with technology and add value to the world by helping others with their technological challenges. Unfortunately, this leaves things like finance on the back burner.

Obviously, you hire people to do your accounting, but it always helps to know a bit of financial matters yourself, if only to have intelligent conversations with the financial folks. For the month of April, we’re running a series of blog posts through which we’ll give you a rundown on some fundamental financial issues. In a perfect world, this would be a lot of Captain Obvious stuff. But if it were obvious, businesses wouldn’t struggle so much with financial matters.

We’re going to start with the most important one — MSP cash flow. If the cash isn’t flowing, that’s when solvency issues start to rear their heads, which also happens to be the cause of a significant percentage of small business failures. That’s why attention to cash flow is, to say the least, mission-critical. Without cash, you can’t pay your staff or your bills, so watch your cash at all times.