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Building a high cash flow business doesn’t have to be rocket science. Nowadays, creating high cash flow doesn’t require extensive capital, but dedicating time and effort to creating a good business plan can set you up nicely for the future.
Read on to learn more about seven business ideas for high cash flow.
What is high cash flow?
High cash flow means a business brings in a reasonable amount of revenue compared to its overhead, with on the higher end.
Many of these businesses that form appealing cash flow statements and balance sheets at the start can eventually create passive income opportunities later.
This isn’t to say that building these businesses is easy. They can be challenging work, and like any other business, there is risk when starting up a new business, so proper planning is necessary.
Here are some business ideas that have proven lucrative.
The best business ideas for high cash flow.
1. Opening a laundromat.
Opening a laundromat in an area with a lot of foot traffic can be a lucrative and somewhat hands-off business. The initial capital expenditures can be costly because you must find a storefront location and purchase equipment such as laundry machines, dryers, chairs, and folding tables. Once you have the necessary equipment and the business up and running, you will begin generating passive income.
Having a laundromat business is a great way to serve the community, but only when you can jump over the possible hurdles. Finding the perfect location for a laundromat can be difficult. You may need to research before choosing a spot to ensure enough traffic in the area, no competition, and ample space for multiple machines.
Starting a laundromat may cost upwards of $100,000, and you may need to open lines of credit and deal with repayments that include high-interest payments. Usually, once you cover the cost of goods, your operating income will pay off startup costs rather quickly, and the best part is that it can be very hands-off after that.
The metrics for cash flow management are promising since operating activities are straightforward and expenses like income tax, bookkeeping, and maintenance fees. For this reason, many small business owners decide to open laundromats to improve their financial health and supplement their other company’s cash flow.
Along with increasing cash flow from the laundromat, you can further your cash flow by investing in vending machines, ATMs, and even game machines, which can be excellent vehicles for passive income.
2. Vending machines.
You can find vending machines anywhere, from schools, hospitals, delis, train stations, and ballparks. Vending machines have grown to a $9 billion industry that is expected to continue to grow within the next few years.
The initial investment of a vending machine or two can be the most costly part of starting the business. Once you have your vending machines, you will need to find suitable locations with enough foot traffic for them to succeed.
One of the critical decisions you need to make after picking the location of the vending machine is the item you will sell in them. The most popular options would be candy, chips, water, soft drinks, trail mix, and granola bars.
When you have all that sorted out, you can sit back and bask in the passive income while occasionally refilling your machine. Plus, you can count your vending machine’s depreciation into your business’s taxes — although, note this will not reflect your free cash flow metric, since it’s a non-cash expense.
3. Equipment rental business.
An equipment rental business can be a great way to make routine cash flow. One of the best aspects of this type of business is renting out whatever kind of equipment you want.
You can rent out equipment such as tools, party equipment, and heavy machinery such as lawnmowers, snow blowers, and pressure washers. One of the reasons this type of business can be so lucrative is because you will only need to make the initial purchase of the equipment, and then you can rent it out over and over and over again.
To keep the equipment running smoothly, you must perform routine maintenance. However, your revenue should quickly provide enough cash to cover maintenance costs. You should see a steady stream of income statements hitting your bank account.
4. Create digital courses.
Creating digital courses can be a reliable source of cash flow if you prefer to make money online. This business can give you enough monthly income to become financially free if you have a loyal and large customer base.
The trick with creating lucrative digital courses is that you need to know how to teach effectively online and learn how to present that skill in an entertaining yet educational way.
Once you create a course, you can continue generating money from it as passive income as you keep selling it. That is even better if you have multiple classes that sell consistently. Some of our favorite online learning sites are Coursera and Skillshare.
5. Dividend investing.
Dividend investing is a standard business activity to help supplement cash flow. You can produce passive income once you invest a substantial amount into the stock market. This involves purchasing and holding dividend stocks while the company pays you dividends. You can see excellent return ratios in your financial statements if you invest in companies doing well and hold them.
The most stocks you acquire will determine how much dividends you will earn. Rates can be pretty low per stock, so it is crucial to diversify your dividend portfolio as they are less risky than other stock market investments. Your cash flow will heavily depend on how the market is performing.
6. Photographer or digital artist.
As a photographer, you are needed at all times of the year, from Christmas photos to senior prom, weddings, and sweet 16s. It is safe to say that photographers can be in business all year round.
Photographing and videoing events can be a great way to produce cash flow, but you can take it even further and become a digital artist by selling your photos online as art. Photos of nature, cityscapes, and wildlife are trendy items sold on many digital art platforms. These can be great ways to make extra passive income as a photographer.
7. ATM business.
With non-bank-specific ATMs being everywhere and the growing popularity of online-only banks, the ATM business is in the billions these days. Even with the dissolution of coins and paper money, this business doesn’t seem to be going anywhere, as people still take debit and credit cards to these machines to withdraw cash.
The initial cost of an ATM can range from $3,000 to $10,000, which is the bulk of your startup costs. You will need to choose the perfect location where there is a need for an ATM for your business to be successful.
The bottom line.
Whether you are looking to replace your nine-to-five job or looking for a side hustle, there are many ways to generate cash flow to set yourself up for the future. With a predetermined amount of money, time and effort, you can set up and maintain reliable sources of cash flow.
If you want to grow your business’s cash flow today, explore additional resources for professional growth at Entrepreneur.com.