Management

To run a business successfully, the cash into a company, over time, must exceed the cash out.

Many companies fail because they haven’t managed cash well.

In large companies, managers running multi-million dollar divisions can lose sight of this, as cash is not of primary importance. This is why many large-company managers fail when they venture into the world of businessmen. Whenever they needed cash, some magical kingdom called “Corporate Headquarters” would send it, just as a parent does for a child at school.

There is no more sobering way to learn this law than to try to make a payroll with no cash in the bank.