Companies increasingly want to reduce their dependency on banks and increasingly regard Cash position as a valuable factor that should not only be monitored, but actively shaped. Because the fact is: increasing the value of a company through liquidity management is possible - and makes sense.

Gone are the days when a company's success was measured solely in terms of turnover and profit. Why? Because a company's cash flow and Cash position are increasingly decisive for its valuation by banks (and on the financial market). At the same time, entrepreneurs are striving to reduce their dependence on banks: for example, in the event of liquidity surpluses, they can use their funds to finance suppliers - instead of entrusting them to a bank for investment. For this reason, the company's Cash position is now seen as a resource in its own right, which - like all resources - should also be used to increase the value of the company. But how?

Because beware: Cash position is a scarce resource! Studies show that small companies in particular have little liquidity cushion to fall back on. This makes it clear that Cash position is not just a resource that should be passively managed, but one that should be consciously and actively managed. Only with individual cash and liquidity management can companies achieve sustainable added value from the resource "Cash position".

Active control and planning - really with Excel?

Many companies use the MS Office tool Excel for all kinds of purposes - including financial planning. Yet Excel is an incredibly rigid application tool that was not created to record such dynamic processes as cash flow and liquidity management. What remains is always the question of whether the transferred data is correct! Was an error made? Did the import work? A really good Excel spreadsheet is something very time-consuming, as it is manual, and also highly error-prone.

Using Commitly effectively

In order to actively manage a company and its Cash position , a continuous and, above all, up-to-date view of all changes and deviations from Cash flow plan is required. This is because these are signs that it is time to act - Cash position must therefore be managed independently. In Commitly, you can immediately see which planned items have been exceeded, which expenses the company will incur in the coming months, which investments are planned and which income can be recorded in the future. Everything is neatly categorized and, thanks to the integration of the accounts, absolutely error-free and always up-to-date.

Credits: Photo by Werner Du plessis on Unsplash