Cashflow is King
Understanding your cashflow is one of the most important things for any business, and it's something that so many companies struggle with.
Knowing the speed at which your customers pay you can be a huge part in keeping cashflow under control.
By adding our Monthly Debtor Days card to your new board you can understand your cashflow in a new way and plan effectively to help keep your cash flow positive, and minimise potential risks.
From our board we can use the ‘Add Card’ button here and then scroll to the bottom section (Balance sheet), and select the Monthly Debtor Days card
This is a “Report” card type, and one you’ll frequently use in Futrli. While this particular template is set up with a pre-built formula, you’ll be able to use his type of card for a lot of various insights due to the flexibility of the card options.
Report cards can be used to report on any account, category, account group, non-financial data, formula (KPI), historical and future periods for actual and/or forecast data over daily, weekly, fortnightly, monthly, etc. It really is that flexible.
Before we proceed any further, let’s have a look at the basic makeup of this (and every Report card)
There are 3 tabs and each does something different. They are illustrated below.
Click through the tabs and make the changes as per the image.
We have also changed the name of the card and given it a description.
1. Settings tab – This is where you change organisations if you have more than one, choose from actuals, forecast or a combination of both – more on that one later! Choose actuals in this case.
2. Report tab – This is also where you add accounts, account categories such as Income or Cost of Sales, non-financial data and custom groups you may have made. In this example we will be using a pre-built formula - Monthly Debtor Days, but when you play with your own cards you can build custom formulas here with the "New Formula" button.
Hit the edit pencil on the monthly debtor’s formula and you’ll get your first view of the formula builder (Don’t worry if this looks daunting at first, but it's actually very easy to use and we'll take you through how it works as we proceed onwards). Change the name of the formula to “How long it takes my customers to pay me” and click OK.
From the report tab you can also customise Charts and Tables from the chart options drop down – In this example we want to show both a table and chart, so ensure you check Table and toggle Large Chart.
3. Columns tab – This tab shows pre-built formulas to help summarise your columns. We need to select the Average one for this dashboard
Click ‘Done’ in the top right of the card, and watch it flip around to reveal your customer payment days.
We can make the card bigger clicking and dragging the dots in the bottom right hand side, enlarging the card will make more data visible.
You can also reorder your cards within your board by holding your mouse down on the title area of the card and dragging to a new position.
Now we have our card built, what can we learn from it?
In this example, the most important number is the average.
You can change the time period in the Report tab to look at a different timeframe, perhaps the last 3 or 6 months.
Try varying the timeframe for your reports to see if you can identify any long or short term trends.
The majority of businesses stipulate 30-day credit terms for their invoices they send out.
This card will help you monitor and improve how quickly you get paid, helping prevent issues with cash flow and alerting the team to any ‘repeat offenders’ that are remiss with payment!
This is just one example of a report card, try experimenting with your own report cards to see what you can learn about your business.
Next Step - Building a Forecast