(This is a contributed post)
The act of doing business always makes it feel like we have to invest loads of money into it. Whether it’s refurbishing your office or implementing new tech, we can run the risk of throwing a lot of money at a business in order to make it survive. But this means that we can have a major issue when it comes to things like cash flow. So, what can we do when we are faced with cash flow issues? Is it about tightening our belts or is it about specific processes?
Addressing Your Individual Financial Concerns
If there is one specific area that is proving to be problematic, then you must ensure that you tackle this directly. Sometimes, getting additional financial help is crucial, and in which case, you should find a broker who specialises in business finance, and this will help you in the short-term. This is crucial if you are struggling with invoice payments.
Sending Invoices Straight Away
When you have invoice issues, if you don’t send them right away, you won’t get paid! The quicker you send an invoice, the better. Because many processes involving invoices can be quite tedious, this means you should think about switching to cloud-based accounting software. That way, invoices are generated quickly and you don’t need to think about it.
Increasing Your Prices
This may not have entered your mind. When there is a problem with cash flow, you need to look at how you are doing in comparison to your competitors. It’s important to be competitive in the modern-day, but you shouldn’t sell yourself short. You got to think about the entire process, from project inception to putting it on the shelves. And if the equipment for inventory prices have increased, but the product you sell has not risen to match it, this may very well provide the solution to your cash flow problems. On the other hand, you may be selling yourself too short, and if your products come off as cheap, then this doesn’t put your business in a good light.
Look At Your Operating Expenses
Getting more cash to come into the business is about the entire process. This means that you need to cut out unnecessary expenses. You could also do this in another way, by looking at the process. We can spend a lot of time trying to make a process cheaper when in fact, we could just cut the process short. An expensive process is usually a long one. If you can find quicker ways to get to the final outcome, either through the right tools, or another way of working, this will naturally reduce your operating expenses. As well, you could work with suppliers, and ask for bulk inventory rates. Or, you could think about leasing equipment. And, as a logical extension of this, you may want to to sell off old inventory that’s gathering dust. But if you can’t sell them, liquidating the old inventory is a simpler option.
Improving your cash flow doesn’t have to be a long and drawn-out process. There are ways to do it quickly. But you have to make sure that you’re doing it for the benefit of your business.