| HBS Case Collection
Cash Management Practices in Small Companies
Most small business managers claim that cash management is their leading concern. Often walking a tightrope between growth and illiquidity, small business managers face different cash management challenges than their counterparts in larger companies. Compared to larger firms, small businesses often have under-staffed and under-trained accounting staffs, volatile cash flows dependent on a single product line, limited access to new capital, and a significant share of their net worth tied up in working capital. These limitations are often compounded by management's focus on growth, which can put additional pressure on the cash management system by increasing net working capital requirements.
Keywords: Motivation and Incentives;
Management Practices and Processes;
Forecasting and Prediction;