Planning for Sufficient Cash for Operations

[Alan Bussey]

For you conveyor wash owners and operators -

I have heard some conveyor car wash owners say that they try to keep cash in the bank that equals 3 months of expenses and loan payments. Some try to keep 6 months.

How do YOU determine how much cash for operations (not for equipment replacements) to keep in the business accounts to absorb temporary to intermediate dips in cash flow? What other sensible methods do you know of?

Thank you.

Alan Bussey

 

[Earl Weiss]

3-6 months sounds good. I think we use mostly SOP. (Seat of the pants) method.

 

[Washmee]

3-6 months sounds good. I think we use mostly SOP. (Seat of the pants) method.

Same here.

 

[Reds]

I keep 6 months COH. That also gives me a cushion in case I have a major equipment breakdown. I experienced a flood and that cushion was enough to replace my Unitec, some motors, and repairs. I make sure that I maintain that cushion. When I was in the fast food biz I kept 3 months in the bank.

 

[Alan Bussey]

Reds -

Awesome.

Thanks!

Alan.