5.5 cash flow

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  • Created by: Drenex
  • Created on: 28-03-19 12:26

5.5

Causes

  • Negative cash flow is caused by bad use of marketing mix which may mean a product that does not fit into a market
  • place where the product is not required or demanded
  • too much capital spend on promotion or the promotion that did not work out
  • Price might not fit into the market

Effects

  • Business with negative cash flow will not be able to sell produce products effectively enough as they won't have capital
  • May cause redundancy or sale of assets .
  • may cause the business to fail and go bankrupt

Overall summary

Cash flow is one of the most important parts of the business as predicting your ins and outs is important because without capital business cannot be sustained this means that negative cash flow will have a detrimental effect on the stakeholders in a business

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