The lifeblood of your company is its cash flow; without a healthy pulse, your business could flatline. This stark reality underscores why cash flow is the paramount metric for your vigilant tracking.
MSP+OS under the experienced guidance of Founder and CEO Adam Bielanski, is here to help you navigate these financial waters. Adam understands the pitfalls of poor cash flow management, having faced them while running his MSP during the recession 15 years ago. Through SPG, he is committed to helping clients master their financial data and leverage it to fuel growth and operational efficiency.
Our team at MSP+OS underscores the characteristics of excellent cash flow:
- Constant transparency into your financial figures.
- Reduced DSO (Day Sales Outstanding).
- Automated payment processes.
In order to better guide service providers, we recently hosted a webinar that addressed end-to-end financial automation. Our discussions encompassed crucial topics, such as understanding QuickBooks and Wise-Sync, and devising online systems to bolster cash flow management and process efficiency.
Insights from Wise-Sync's CEO
Paul MacNeill, Founder & CEO of Wise-Sync, knows the hardships of managing a stumbling finance team. In his past experience, his bookkeeper lacked vital visibility into their ConnectWise implementation, leading to a blind spot in real-time cash flow tracking. This resulted in severe delays in financial reporting and the creation of a disconnect between systems.
Realizing the urgency to salvage his business, Paul overhauled his accounts receivable, and this move has since underscored the necessity of robust AR control. After all, your operational capabilities are severely restricted if payments are not being received.
From his experiences, Paul shares three crucial tips for MSPs:
- Automation is vital. Your business can't earn if it's tied up in sending invoices.
- Remember, you are not your clients' bank. Prioritize getting paid promptly.
- Guaranteeing your cash flow is a sure-fire way to create profit.
MSP+OS advocates for an efficient process that ensures prompt payment and supports automation, resulting in better visibility, efficiency, and, consequently, robust cash flow. We help you set up integrated systems that not only ensure seamless cash flow but also provide valuable insights to make informed business decisions.
Financial Data Accuracy
In order to ensure accurate financial figures and gain invaluable business intelligence, two key elements are required:
Integration of accounting systems and financial tools.
A robust system to track revenue and actively collect cash.
MSP+OS suggests leveraging down payments as a way to maintain a steady cash flow. We emphasize the importance of separating income versus profitability costs, rather than lumping everything into a single "sales" category. This detailed approach allows for more informative Profit & Loss sheets.
To help drive overall profitability, we at MSP+OS focus on certain KPIs:
- AR over 30 days — What's your accounts payable balance? This should be tracked weekly.
- Number of deals opened — What’s your tally of new monthly recurring contracts? Non-recurring contracts?
- Project stats — How many projects are open? How many service tickets have been completed?
- Kill ratios (for tech & consulting services) — Have you addressed more tickets than you’ve received in any given week?
Cash flow functions like a fire alarm, signaling when your business may be running low on the funds necessary for operation. When you can't meet your financial obligations as they come due, insolvency looms, and personal liability becomes a concern. To avoid this perilous path, companies focus on managing cash flow to gain clear insight into their financial performance.
This insight allows businesses to strike a balance between their available funds and business investments, fostering a stable financial environment. With MSP+OS expert guidance and strategic tools, companies can enhance their cash flow management, ensuring the fire alarm of insufficient funds remains silent, allowing the business to grow and thrive sustainably.
HOW MSP+OS CAN ASSIST IN OPTIMIZING CASH FLOW
Optimizing cash flow doesn't happen by accident. It requires knowledge, strategy, and proactive efforts to enhance financial operations. MSP+OS can assist businesses by enabling their understanding of financial metrics, guiding them towards best practices in cash management, and facilitating the use of innovative tools for automation and accuracy.
We have a proven track record in helping clients understand their financial standing, streamline processes, and create strategies for sustainable growth. Our approach is informed by firsthand experience, as our founder and CEO, Adam Bielanski, navigated the financial challenges of managing an MSP during a major recession.
Having recognized the perils of inadequate cash flow, he established MSP+OS with the core mission to help businesses fully comprehend their financial performance and leverage this understanding to foster scalability and efficiency.
THE MSP+OS APPROACH TO CASH FLOW MANAGEMENT
At MSP+OS, we believe in the paramount importance of maintaining a healthy cash flow for the longevity and success of any business. We highlight three primary areas that contribute to robust cash flow management:
Transparency in Financial Data: It's essential to have real-time visibility into your financial numbers, as this allows for timely decision-making and proactive interventions when needed.
Short DSO (Days Sales Outstanding): A shorter DSO ensures that your cash inflow happens quicker, improving the overall cash position of your business.
Automated Payment Processes: Automation in payments reduces manual efforts, errors, and delays, ensuring a smoother cash flow.
To support businesses in their journey towards improved financial management, we recently organized a webinar focusing on end-to-end financial automation. The webinar offered insights into QuickBooks, Wise-Sync, and developing online systems for better cash flow management and process efficiency.
MSP+OS: YOUR PARTNER IN ACCOUNTS RECEIVABLE MANAGEMENT
Efficient management of accounts receivable (AR) can significantly impact a company's cash flow. The right AR strategy ensures that your business collects the revenue it's owed in a timely and efficient manner.
MSP+OS, with the help of its experienced team, can guide you in revamping your AR strategy. We underscore the importance of monitoring your AR diligently, as not receiving payments promptly can lead to cash flow bottlenecks.
Drawing from the experiences of Paul MacNeill, Founder & CEO of Wise-Sync, we share some crucial tips for effective AR management:
Automate your invoicing process: Your business won't be profitable if you're still manually sending invoices. Automation speeds up the process, increasing the likelihood of quicker payments.
Prioritize getting paid promptly: Don't act as a bank for your clients. Focus on shortening your payment terms and following up diligently.
Keep a keen eye on your cash flow: Ensuring a steady cash flow is the foundation of profitability.
BRINGING ACCURACY AND BUSINESS INTELLIGENCE THROUGH INTEGRATED SYSTEMS
At MSP+OS, we emphasize the importance of integrated accounting systems and financial tooling for ensuring data accuracy. Such integration not only enhances the reliability of your numbers but also enables crucial business intelligence.
Moreover, we advise businesses on best practices to track revenue and actively collect cash. For instance, we often recommend leveraging down payments, which ensure you have cash in your deferred revenue account that can be allocated against future income.
IDENTIFYING CORE KPIS FOR HEALTHY FINANCIALS WITH MSP+OS
Ultimately, MSP+OS's mission is to equip businesses with the knowledge and tools they need to thrive in a competitive landscape. One of the ways we do this is by transforming the way you perceive and manage cash flow.
MSP+OS leverages industry-specific experience, advanced financial automation tools, and unparalleled insights to help you refine your financial operations. Our customized solutions are designed to enhance your financial clarity, improve your accounts receivable process, and streamline your financial workflows.
With our assistance, your company can achieve end-to-end financial automation, integrating essential tools such as QuickBooks and Wise-Sync to improve cash flow and process efficiency. This integration provides your business with the kind of financial intelligence needed to make informed decisions and take proactive steps towards success.
We understand that every company is unique, and we approach every project with this in mind. MSP+OS is committed to understanding your specific goals, challenges, and opportunities, and we work with you to design a customized strategy to enhance your financial performance and profitability.
In conclusion, remember this: Cash flow is not just a number on your balance sheet. It's the lifeblood of your business, influencing every decision you make. By prioritizing cash flow management and working with a strategic partner like MSP+OS, you can ensure your business has the resources it needs to succeed in today's dynamic market. Together, we can turn cash flow management from a daunting task into a powerful strategy for growth and profitability.