For any start-up business owners, one of the biggest goals is to see profits growing at a fast pace and increasing profits each year, and the most common mistakes you can make is to place other business goals ahead of your company’s cash flow. At Swift Resolution we recognise that a good cashflow can make or break a business.
Monitoring the critical numbers of your cash flow statements monthly or weekly will tell you just how much is coming in and how much is going out of your business. For instance, if your debts (payables) are due before your receivables (money that hasn’t come in yet), you could face cash flow problems. This then means that you are likely to face trouble when paying bills, which can lead to bigger problems, like missing payroll; which in turn would prompt questions of creditworthiness.
So we’ve put together some tips to help maximise your cashflow and make it work for you.
Monitor your cashflow
Selling anything that leaves you at a loss doesn’t help generate a positive cash flow. Online software such as QuickBooks can make it simple to settle your accounts and generate reports. Often you can easily access the platform from the cloud, meaning you can stay on top of your cashflow wherever you are.
Everyone loves an incentive. If you offer customers a discount for paying their bills ahead of time, you’re creating a win/win situation for both of you. Getting the cash paid in early helps your cash flow.
Encourage repeat business.
If you’re in a volume-driven business, you need to focus your efforts toward getting your customers to come back and more often. In most cases, you won’t start to see a profit on a customer until their third or fourth transaction.
Stay on top of invoicing
You’ll see receivables come in more quickly this way.
Keep your business and your personal finances separate
Mixing your business and personal finances can leave you uncertain about business performance. So keep them separate. That way you’ll know how much cash your company is generating. Then you’ll be in a good position to properly pay yourself – and use excess cash to strengthen and grow your business.
Swift Resolution can help your company maintain a positive cashflow with our credit checking and debt recovery services. Get in touch with our friendly team on 0808 145 1886 1or email firstname.lastname@example.org