11 Cashflow and Compounding
What is cashflow and where does it come from?
Cashflow from business interests
Business owners have a capacity to leverage their time beyond what employees and the self-employed can do.
This doesn’t mean that being a business owner is better than being an employee or being self-employed, it is just different.
A business in its true sense can enable the business owner to be away from the business while it still functions effectively, creating continuing cashflow for the business owner. At the highest level, a business continues to grow when the business owner is not working in the business.
A business benefits from being a structured and systemised operation which provides goods and services to people, without being dependent on one-person’s time or skill.
Business owners need to be clear about their vision and positioning of the business in the marketplace.
If you predict a reducing demand for the goods and services you provide, it is necessary for the business owner to re-invent the business in order to “stay in business”.