Liquidity is crucial for creating the opportunities or developing the product that accelerates a business, or for offering employees the best working conditions. For a startup like QuickOrder, liquidity is key to its development. That’s why Mads and the rest of his team are highly focused on making the best use of their liquidity.
However, it seems that Mads and his team have managed to use their liquidity effectively. QuickOrder’s customer list keeps growing, and the company’s growth is the kind that all entrepreneurs dream of. With this growth, the employee count has also risen, which in turn affects their liquidity. At QuickOrder, there is always a strive to offer every employee the best possible equipment for work.
But this puts pressure on liquidity, as purchasing a new computer for 20,000 DKK every time a new employee is hired can quickly add up. Liquidity can come from banks or external investments, and both options are available to QuickOrder. However, growth doesn’t just come from having liquidity; it also depends on how effectively you use it.
With investments or bank loans, QuickOrder would temporarily have the liquidity to meet the growing needs for the best work tools as the company hires more employees. But Mads and his team have learned that buying a MacBook Pro for a developer each time a new hire is made was draining QuickOrder’s liquidity too quickly.
Beyond the fact that QuickOrder would be tying up too much liquidity in work equipment, Mads couldn’t help but think about what would happen next time QuickOrder hired a new employee, or if the equipment broke down. Would there be enough liquidity to cover these unexpected costs?
If the equipment breaks down or needs upgrading, the company would be forced to use its liquidity immediately for repairs or upgrades. A black screen, for instance, would not just mean that work couldn’t continue efficiently – it would also affect employee satisfaction. Inefficiency and unhappy employees aren’t the kind of conditions that foster the growth that QuickOrder has achieved
