How to manage cash flow like a boss
Here are ten informal cash flow tips for small businesses.
We finance a lot of cash flow for small businesses but sometimes financing the shortfall isn’t the answer in isolation.
Here are ten top tips for better cash flow:
- Stay on top of your cash flow like a boss: Keep a close eye on your cash inflows and outflows. Know exactly where your money is coming from and where it’s going. If you have an expense you don’t recognise then challenge it.
- Chase those payments like a determined bulldog: Don’t be afraid to follow up with customers who owe you money. Send friendly reminders, make phone calls, or even offer incentives for early payment. But get that dough! A client, by definition, is someone who pays you for your goods or service.
- Get cosy with your suppliers: Build good relationships with your suppliers and try to negotiate better payment terms. It’s like having a friend who’s cool with giving you a little extra time to pay the bill. You will find that having a good relationship with key suppliers means they will come to you with offers also.
- Keep your expenses in check: Trim the fat wherever you can. Look for ways to cut costs, whether it’s finding cheaper suppliers or getting creative with DIY solutions. Saving money is like finding hidden treasure and it’s much easier than going out and working for it.
- Be a smart shopper: Don’t rush into buying things for your business. Shop around, compare prices, and make sure you’re getting the best deal. It’s like finding that perfect pair of shoes on sale, it feels great, whereas buying a pair you only sort of like leaves you underwhelmed.
- Plan ahead, but stay flexible: Create a cash flow forecast to see what’s coming down the pipeline. But remember, things can change, so be ready to adjust your plans as needed. Think of it like navigating through a maze – stay agile! Remember also that a forecast is a best guess, if it is a little out then that’s fine, just refine it and go again.
- Make cash flow a team effort: Get your whole team involved in managing cash flow. Educate them about its importance and encourage them to suggest ideas for improving it. Everyone’s in the same boat, rowing together and the more they understand how they fit into the bigger picture the more they will generate great ideas for you.
- Celebrate the wins: When you have a positive cash flow, celebrate! Treat yourself and your team for a job well done. It’s like reaching a cash flow oasis in the desert. Enjoy it.
- Learn from the past: Reflect on past cash flow challenges and successes. Use those lessons to make smarter decisions in the future. It’s like having a cash flow time machine!
- Have fun with it: Managing cash flow may not be the most exciting part of running a business, but embrace the challenge with a positive attitude. Remember, you’re making money moves and whilst it isn’t exciting it is something that helps avoid sleepless nights.
These tips may be a bit light-hearted, but they still focus on the important aspects of cash flow management.
We can always help finance that cash flow gap, but unless you address the gap and control it you will soon be back to square one and entering a cycle of financing that never really solves anything. Get in touch.
By Dave Farmer