What are some specific investment-related activities

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Mary Margaret Glenn knew the going would be tough the first couple of years. She was now finding out exactly how tough. After five years of working for others, Mary and her former college roommate had pooled their resources and purchased a small building not far from the college campus. In it, they served gourmet coffees and specialty pastries. Business was good, when ‘‘good’’ was defined as consistently increasing weekly sales levels and strong profit margins. Unfortunately, during the recently completed campus Spring Break, their sales volume fell significantly (about 80%). As Mary’s roommate pointed out, however, the expenses did not fall. Rent, insurance, utilities, and lease payments were just a few of the operation’s expenses that did not take a break during Spring Break. As a result, cash was tight. The operation would make its bi-weekly payroll, but not by much. Fortunately, the students had returned, and so had revenues. But it had been a narrow escape—too narrow, thought Mary.

What are some specific investment-related activities you could suggest to Mary to avoid a cash flow crisis the next time her business volume reduces dramatically?

Reference no: EM131121894

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