Cash flow notes and funding articles for Jonesboro, Arkansas law, therapy, dental and restaurant owners.
How a Craighead County, AR law office can improve cash flow
A law office's cash flow swings because fees arrive by matter. A few habits narrow the swings:
- Bill hourly matters every month on the same day, not when a matter closes.
- Take advance fee deposits on new matters, held in trust until earned as the rules require.
- Track unbilled time weekly, so work in progress does not pile up unseen.
- Offer card payment and written payment plans for clients who cannot pay a balance at once.
- Keep a credit line open for the months a large contingency fee is late, and pay it down when the fee comes in.
None of these changes how much the firm earns. They change when the cash shows up, which is what the payroll and rent depend on.
How Craighead County, AR therapy and chiropractic offices prepare a cash flow forecast
A forecast for a therapy or chiropractic office starts from collections, not from visits. Take the last three months of deposits by week and note which payers they came from. Project each week's collections from the claims already submitted and how long each payer usually takes. Then list every payment the office makes, with its real due date: payroll on its pay schedule, rent on the first, equipment leases on their own dates, and supplies. Subtract, carry the balance forward, and find the week with the smallest balance. That low point, not the average, is what a line of credit or a working capital loan would need to cover.
A 13-week cash flow forecast for Jonesboro, AR therapy and chiropractic offices
Illustration only, invented figures: a therapy office starts the quarter with $18,000 in the bank. Collections vary from week to week; payroll of $11,500 is paid every other week, starting in week 2; rent of $3,800 falls in weeks 1, 5 and 9 of this invented calendar; an equipment lease of $620 falls in weeks 3, 7 and 11; and other costs run $1,600 a week.
| Week | Collections | Payments | Ending cash |
|---|---|---|---|
| Week 1 | $8,800 | $5,400 | $21,400 |
| Week 2 | $8,400 | $13,100 | $16,700 |
| Week 3 | $8,900 | $2,220 | $23,380 |
| Week 4 | $7,600 | $13,100 | $17,880 |
| Week 5 | $8,700 | $5,400 | $21,180 |
| Week 6 | $8,300 | $13,100 | $16,380 |
| Week 7 | $6,200 | $2,220 | $20,360 |
| Week 8 | $7,100 | $13,100 | $14,360 |
| Week 9 | $8,900 | $5,400 | $17,860 |
| Week 10 | $8,600 | $13,100 | $13,360 |
| Week 11 | $9,100 | $2,220 | $20,240 |
| Week 12 | $8,200 | $13,100 | $15,340 |
| Week 13 | $8,800 | $1,600 | $22,540 |
Over the 13 weeks, collections total $107,600 and payments $103,060, so the balance ends at $22,540, $4,540 above where it started. The low point is week 10, a payroll week, at $13,360; week 7 brought the smallest collections of the quarter, $6,200. An office that wants a cushion above that low point can see from the table how much a credit line would need to carry.
Articles for Jonesboro, AR practices, restaurants and buyers
Auto repair shops pricing a lift or tire machines will find worked payments on the auto repair page. The articles on this site cover these topics for Jonesboro, AR owners:
- How Jonesboro, AR dentists fund operatories, imaging and practice buy-ins
- What physician and specialty offices in Jonesboro, AR finance
- When a fixed-payment term loan fits an expansion in Jonesboro, AR
- What funding restaurants and coffee shops in Jonesboro, AR compare for kitchens and payroll
- How the purchase of a Jonesboro, AR business or practice is financed
- How Jonesboro, AR owners fund a franchise unit or a second location
By Rainhill Lenders · Updated