SAJ Solutions Case Study

Introduction

SAJ Solutions focuses on the major cash flow issues within the business and provides an absolute Solution that perfectly fits to solve the issue. Here are some major reasons for the financial issues in the business:

 Increased competition

 Smaller pool of clients

 Loss of major contract or client

 Increased operating cost

 Major changes in industry

 Legal disputes with partners

 Force majeure (Natural Disasters)

 Various accidents

 Departure of important staff members

Therefore, here are the issues described in detail:

Not Enough Cash Flow

Cash flow is calculated by subtracting total expenses from total income. If the resulting number is positive, the company is making a profit, and is considered to "be in the black."

High overhead expenses

Overhead expenses are the costs of running a business that are not tied directly to selling a specific product or service. Examples of overhead include rent, telephone, utilities, etc. Sometimes overhead expenses get out of hand relative to the revenue the business produces. High overhead expenses can hurt your business’s cash flow.

High overhead expenses are particularly challenging because they are persistent. These expenses affect your cash flow every day until the problem is corrected.

Solution

The solution to this problem is simple, but it is not easy. Audit your expenses and cut back where you can. Be careful not to cut too much, as that approach could also hurt the company.

If you cannot cut back, consider cheaper options. In fact, every business should audit expenses regularly to ensure that overhead expenses stay in line.

2. Slow-paying invoices

Slow-paying invoices are a common cause for cash flow problems. As a small business, you have to offer 30-day to 60-day payment terms to clients. However, small companies can’t always afford to wait this long for payment. They need money sooner. Eventually, slow payments create a financial problem that can seriously affect your business even if it’s growing