In our experience at RCapital there are three key areas of weakness among business owners: a lack of understanding of the meaning of cash flow management; a tendency towards over trading; a reluctance to ask for advice from those who have had practical business experience – until it’s too late.

We interviewed Colin Stevens, founder and managing director of Better Bathrooms, for this month’s “Business in the Spotlight”. Here’s what we discovered about the business, the man behind the business and his journey as a member of the Entrepreneurs’ Business Academy.

Businesses need cash to be able to pay staff on time, buy supplies, repay debts on time and to pay dividends etc. If you don’t have cash to pay a supplier when the payment is due, you might find you lose the trust of the supplier and the outlet AND they may declare your business insolvent.

In a recession or not, controlling cash is totally critical for business survival. Once they have been recognised, many cash flow problems can be reduced or turned around – many business owners are slow to pinpoint the problem, and then it’s too late.

Whether in a recession or not, controlling cash is absolutely critical for small firms. Often cash flow problems can be reduced. However, 90% of firms are still failing because of lack of knowledge and skills of the business owner.