Running a small business is busy! There are plenty of plates to keep spinning, and it’s all too easy to take your eye off one or two of them.
One thing you simply cannot let slip is keeping control of your cash flow.Cash is the lifeline of a small business, so here are a few things to think about to enhance your cashflow.
Getting an accurate Cash-Flow forecast is a great place to start. Knowing what you are expecting to receive and spend helps highlight any pinch-points early, and enables you to formulate a plan to get around them.
On the positive side, it may highlight times where you may have surplus cash, affording you to invest into the next big project you have in mind.
Work with your accountants to get a 12 week forecast developed. You want something that is easy to maintain and roll forward weekly.
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Are you on top of your debtors?
Making sure your customers are paying you on time is pivotal in making sure that cash is flowing into your business, and your forecasts are accurate.
Do you have any customers that are notorious late payers? Think about how you deal with that? Try and be as proactive as possible, and bombard them with opportunities to pay their outstanding invoices.
On the other side of the equation, how active are you in controlling your outflows?
Are your supplier payment processed serving you as well as they could?
While paying suppliers on time is a must if you are looking at building strong lasting relations with them, but are you paying them too early?
Paying suppliers on the latest pay-run that ensures you have still paid on time, is going to keep your cash in your business for as long as possible.
How do you plan for your regular liabilities?
I am talking about Payroll costs, VAT submissions, your tax liabilities.
We all know they are coming, do you know exactly when they are due, and how much they are likely to be?
It’s good practice to regularly put a little aside for these, so you aren’t left scratching around trying to fund these payments the day before due date.
While these tips don’t actually change the amounts of cash flowing through your business, they will instil a level of control over the movement, which will add some value to you.
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As you’ve made it to the bottom of blog, here is a little treat for you.
I have included a download link to my 12 Week Cash Flow forecast sheet, mentioned above!