Got too much money going out and not enough money coming in? Keeping your cash flow under control is the key to a successful business. Here are just 5 ways to help improve your company’s incoming and outgoing costs.
This is a contributed post. Please refer to my disclosure for more information.
Hire the help of a financial advisor
When it comes to making cutbacks, it’s worth hiring the help of a financial advisor. Such professionals may be able to see areas where you’re spending too much – these could be expenses that you hadn’t even realised you were spending too much on. Shop around online for a trustworthy financial advisor.
Record all your expenses
To help you spot where you could be spending too much money, it could also be worth keeping better records of all your expenses. If you have employees who may use resources or pay for fuel when driving, it could worth also getting them to record their expenses to see where costs may be trimmed. In some cases, you may be able to set limits for employees, getting them to dig into their own pockets if they exceed this limit. For example, many companies introduce a paper quota when it comes to printing in order to save costs on printing supplies.
Keep on top of incoming payments
Late paying customers can often lead to cash flow problems. Make sure to alert yourself so that you know when payments are supposed to be due – if these payments don’t come through you can then chase them up. When it comes to serious late payments, you could also consider hiring a debt collection agency.
Borrow wisely
If you want to keep a positive cash flow, you’re often best avoiding getting into any debt, however there are some cases in which borrowing can prevent cash flow problems. If you’ve got bills to pay, but you’re still waiting for a customer to pay, you could always consider bridge loans as a way of temporarily covering these bills. Invoice factoring is another means of borrowing money.
Take steps against seasonal lows
Certain companies can be seasonal which can result in lots of customers one month and hardly any clientele the next. If you find that this is the case, it could be time to diversify your services so that you’re offering something for everyone throughout the years. For example, if you sell barbecues you may want to start selling ovens and indoor cooking equipment so that you’re still able to attract business in winter.
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March 2, 2020 at 12:50 pm (4 years ago)It is very essential to keep track on everything you spend your money with. Its like tracking where all your money go. Thus it will also give you an idea how to cut things which you don’t need most to fix your cash flow.