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Actions to minimize cash flow problems: inflows and outflows

1. What actions can you take to minimize the cash flow problems that were identified in the simulation? Look at the problem from both the inflow and outflow of cash to determine what actions you can conceivably take to assure adequate cash availability.

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1. What actions can you take to minimize the cash flow problems that were identified in the simulation? Look at the problem from both the inflow and outflow of cash to determine what actions you can conceivably take to assure adequate cash availability.

The cash flow is affected by cash coming in and out of the business. The activities that cause these inflows and outflows of cash are those R&D costs, production, marketing, and financing. With regards to these factors, the cash flow problems must be minimized from both sides, inflow and outflow of cash. The actions you can pursue to assure adequate cash availability was also explained.

To minimize the cash flow problems regarding the outflow of cash:

? Reduce R&D costs.
- First the firm must design their products reasonably. The firm must design its products according to the buying criteria of the target customers. Doing so, the firm avoids the increase of its R&D costs for the current year.

? Create greater workforce through human resources.
- Enough workforce must also be provided in order for the firm to meet its number of products produced and its sales target for the coming years. At the same time, whatever the firm does in ...

Solution Summary

This solution is comprised of detailed explanation of actions to take in order to minimize the cash flow problems in a business simulation. It addresses the problem from both the inflow and outflow of cash to determine what actions you can conceivably take to assure adequate cash availability.

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