page contents

A business can make profit yet lack money to pay debts

Last week, I mentioned in closing that “… cash is king. A profitable business without cash will close down but a loss-maker awash with cash will continue operating.”

This remark has disturbed a number of readers and they have asked whether it is realistic to expect a profit-making business to have a shortage of cash.

Well, the answer is not only yes, but also that this is a very common state of affairs. Indeed, quite often when a business fails, we hear the senior managers talking about “cash flow challenges”. They never say that they a…
Business News

Leave a Reply

Your email address will not be published. Required fields are marked *

*

This site uses Akismet to reduce spam. Learn how your comment data is processed.

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.

Close