How To Maintain A Healthy Cash-Flow In Your Small Business
So, your customers are more than happy with your services or products and you’re achieving repeat customers. You are ready to embrace the growth and take on more and more projects. You know that healthy cash flow to achieve this and it’s the lifeline for any small business, however, there’s a problem. Your cash-flow heavily relies on your customers and that can sometimes mean that cash can be tight. How can you look after it better?
Let’ have a look at some of the ways a small business can maintain a healthy cash-flow:
Think About The Payment Terms
You need to be aware of the customer payment practices, with this you will be able to manage the terms you offer to your customers better as you’re able to plan.
Think about any pondering questions and then do some research before you think about striking up any new deals or offering new services. There are several things to consider, such as certain companies’ payment habits and longer-term payment.
Some companies will only pay their invoices on a certain day or time of the month.
Think About Invoices
You need to enjoy prompt payments of invoices wherever possible. It might seem like something really simple but if you don’t invoice your customers on time then how can you expect to be paid on time?
Delaying your invoices can mean that you’re tugging on your cash-flow when you don’t need to, it can be avoided.
Try to have just one person in charge of invoicing, it probably won’t be someone’s entire job but set aside some allocated time for them to complete them each week. Make sure you maintain an organized system and have a reliable accounting system that will keep track and help when you come to file your taxes.
Offer Smart Pay Options
Having good cash-flow management is essential for a growing business. It can be seen as a delicate operation.
Make sure you have payment options for your customers such as being able to make payment by cash, card and with the ability to be able to verify checks online. It might be a good idea to speak to your customers, contractors, and suppliers to see what payment options work for them. Catering to their needs means you’re limiting any problems with your cash-flow.
Use Technology Advances
In recent years technology has advanced at a staggering rate, it has really transformed the way that businesses are run. Businesses use to manage their cash flow with things such as Excel however with technology the way it is now a whole range of options has opened.
One of the most popular ways to now manage your cash-flow is to use a cloud-based accounting service. It should make keeping track of your finances and invoicing much easier and more simple. You can even access these on your mobile or tablet so you can monitor and work on it while on the go 24/7.
These four methods should help you to maintain a healthy cash-flow in your small business. Do you have any other ways that you can achieve this that you can share in the comments section below?
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