[Column] When the flow of funds stops, companies go bankrupt.

I would like to introduce a column article.

Cash flow management involves monitoring how much money is deposited and how much is withdrawn over a certain period. The income statement shows how much revenue a company has earned and how much profit it has made during the current period, but a company can still go bankrupt even when it is in the black. This may seem like an inexplicable phenomenon, but it is a fact. The reason this happens is that "funds" in a company are akin to "blood" in the human body; if the flow is cut off, no matter how healthy the body is, life cannot be sustained. Cash flow management is like boxing. The income statement is like a baseball pennant race; there may be months when the company is in the red, but as long as it can turn a profit by the end of the fiscal period, that is sufficient. However, cash flow management is like a boxing match; even if you know that 100 million yen will be deposited tomorrow, if you cannot prepare the necessary funds today and end up issuing a bounced check, the company will be knocked out. In other words, while profit is certainly necessary for a company to survive, cash flow management is also extremely important. *For more details on the column, please refer to the related links. For further inquiries, feel free to contact us.*

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