Running a small business is tough. There's never enough cash, time, resources, or people to get everything done. Effective cash flow management strategies are key to keeping a company afloat and able to grow. This article will share some of the best ways you can keep your business in the black and stay profitable despite all of these challenges.
1. Ask for a deposit or milestone payment:
As a business owner, one may be accustomed to receiving payment for all work upfront. But as times change and people's purchasing power declines, it is becoming more common to do some of the work before getting paid. This will help one know when asking for a deposit or milestone payment is appropriate and how to do so in the most professional way possible.
2. Cut or Delay expenses:
We all know that the economy is not doing well. It's been tough on most of us, and it doesn't seem like it's getting better any time soon. One can do a few things to reduce some expenses: by cutting out certain items or delaying them.
3. Request more favorable payment terms from vendors:
Cash Flow is dedicated to helping businesses understand how to better manage their finances and cash flow Management.
First, make sure that the vendor owes your business money before requesting special treatment. Next, contact the vendor in advance and ask for a meeting. Use your research on them as leverage and be clear on what you want out of them by asking for favorable payment terms or an extension of credit limits. Finally, stay persistent! You're not going to get what you want if you don't ask for it!
4. Turn down, shift or postpone work:
The internet has made it possible to work from anywhere in the world. While this is a blessing for many, there are also drawbacks. One of these being an increased workload due to the pressure of never-ending deadlines and lack of physical boundaries.
This can lead to burnout, which can cause lower productivity as well as high levels of stress when working on something that you don't enjoy or feel passionate about. For those who have found themselves in this situation and want a way out, consider turning down new projects that seem like they will only add more work without providing any additional benefits, or shift your focus to tasks that may be less demanding but still provide value such as administrative duties or research tasks. Finally, if you find yourself too stressed by your cash flow management, the next point here will help.
5. Sell invoices:
If you are looking for a tool to help with your cash flow, then look no further. Sell invoices do just that and more. This platform offers an easy way for companies with outstanding invoices to sell them at a discounted rate in exchange for immediate payment. It also provides the ability to automatically send invoices when they're due so that a business can avoid late fees or penalties from the customers. With this platform, there's never another missed invoice again!
Contact us here for a Cash Flow Management Strategy for small businesses.