Use the following module to help you how to record all your business transactions.

1. CASH FLOW MANAGEMENT
2019

2. EVERY BUSINESS DECISION IS A FINANCIAL DECISION
1. Every decision in your
business, whether it is to
do marketing or hiring
new employees goes
hand in hand with a
financial impact.
2. Every business decision
has implications on cash
inflow and cash outflow
in your business.

3. DISCUSSION
Why is cash flow
management
important for the
success of your
business?

4. THREE KEY STRATEGIES FOR FINANCIAL MANAGEMENT
1. To protect the cash flow:
• To increase sales;
• To decrease expenses;
• To be ready for
uncertainties.
2. To maintain reliable
accounting procedures.
3. To create and analyze
reports and financial
declarations.

5.  Sara purchases on 100 KES per success
card and sells it to 250 KES;
 Almost the total of the success cards are
sold when students sit for final exams;
 Last year, she sold 100 success cards only
in November.
 In April, her supplier proposed her a good
price of 50 KES per success card for a
quantity of 400 success cards.
 The challenge was that in April, she didn’t
have 20,000 KES ( Twenty thousand) at her
disposal for that big purchase.
 What should she do?
EXAMPLE: SARA’S Retail shop

6. Do you know
the fixed costs
of your basic
products and
services?
Do you know
the variable
costs of your
basic products
and services?
Will your
prices cover all
the expenses
and reserve a
profit margin?
THE KEY TO TAKE ADEQUATE FINANCIAL DECISIONS IS TO
HAVE CORRECT INFORMATION.

7. STRATEGIES TO MANAGE DEBTS
1. Immediate follow-up of debtors: Until you
get paid. The earlier you follow up, the
luckily you will get paid!
2. Come up with creative solutions: If the client
is facing financial problems, ask him/her
how much he/she can manage to pay at the
moment. Extend the payment period in
written once the client accepts that mode of
payment.

8. MANAGEMENT OF EXPENSES
SEASONAL REVENUES:
Exercise:
Timothy’s Textbooks
Timothy owns a book
shop for students.
 He realized that 90% of
sales is made in 2
months preceding the
start of the academic
year.
 Despite the situation, the
shop has continuous
expenses for the whole
 What should he do to maintain
his activities during low season?

9. TIPS TO MANAGE SEASONAL SALES
1. Save during the peak
season for the low
season;
2. Avoid keeping goods
the whole year;
3. Reduce expenses on
salaries during low
season (Increase the
number of casual

10. 4. Be careful on loans;
• If you are requesting a loan for the peak
season, please request short term loans
that are easily payable.
TIPS TO MANAGE SEASONAL SALES

11. SALES FROM A SINGLE CLIENT
 Some businesses sell to a single bigger
client. Eg. The government institutions and
other big institutions.

12. TIPS TO MANAGE SALES FROM A UNIQUE CLIENT
1. Integrate small scaled
clients for constant
sales to minimize risks
of failure.
2. Before you deploy big
investment, make sure
you have a long term
commitment from your
unique client;
3. Have a follow-up plan

13. DECREASE OF EXPENSES

14. DECREASE FIXED COSTS
Fixed costs are obliged expenses
regardless of the produced quantity of
products and services. Eg:
 Rent
 Salaries
 Taxes
 Transport
Does your business have fixed costs?
What are the possible strategies to lower them?

15. NOTICE
 It is better you cut off your expenses, but you
shouldn’t touch on the main activities defining goals
of your business!
 Smart investment may facilitate to increase your
sales and gain more revenues than you invest.
 You need to invest in your products and services
that enables you to make profits.

16. THANK YOU!