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Discuss a management strategy used to retain or increase cash. Share an example of a time...

Discuss a management strategy used to retain or increase cash. Share an example of a time when you’ve used a similar strategy in your personal finances. How are the applications of these strategies similar or different for businesses and individuals?

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Answer:

Management strategy used to retain or increase cash- Are as following:

  1. Company can take the property on lease instead of buying because buying the property needs heavy one time investment so initially company can go for lease rather than buying.
  2. Company can offer discount and cash backs to its customers if they pay on or before time so that company can get cash flow on time.
  3. Company should use the corporate savings accounts that provide higher interest.
  4. A growing company can increase the price of its products or services to increase the cash flows.
  5. Company should make the idle cash in the business more productive by investing it into short term securities that can be redeemed easily if funds are needed.
  6. Company that retains cash in the business, can invest this cash for further expansion or growth purpose so that company can produce more goods and company sales may increase

Example of my personal life- This we do in our personal life as well, I make payments via debit or credit card, I keep less cash with me. I keep my all cash in saving account so that I can get some interest, I also go for short term and long term investment alternatives that give me income in the form of capital appreciation and dividend.

Some strategies are similar while some strategies are different, they differ from business to business and personal to person.


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