Being in control of your cash flow is vital. Here is a brief list of 5 things that can help you improve your cash flow in the short term.
1. Invoice accurately and on time
The smallest mistake on one of your invoices provides an excuse to delay payment. So make sure that all your invoices are accurate. We all make mistakes – we are only human after all. But, paying attention to detail eradicates mistakes and helps your cash flow.
2. Think of effective ways you can increase payments to you
Cut down on the amount of time you spend waiting for a payment by offering an incentive. It may seem crazy, but a discount of even 1% or 2% can increase your chances of speedier payments. Don’t think that just because such an incentive wouldn’t work for you that it may not also work for someone else!
3. Sell some assets
If you have some underutilised assets in your business – sell them! What’s the point of having a printer that you don’t use just gathering dust in the corner? A new business down the road could be in the market for such a thing – sell it; get some cash back on something you never use! You could also think about leasing underutilised assets.
4. Get a grip on your debts
Chase your debts up regularly and politely. Don’t be afraid to ask for money you are owed.
5. Understand when your customers pay their bills
Ask your clients when they pay their bills and incorporate this into your credit control function. It’s a simple point that it often forgotten about by small businesses. Missing a cheque run may mean that you have to wait another month – and time it a commodity that many small businesses cannot afford!
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Haywards provides helps for small businesses on a wide range of subjects – contact us for more details.