cash flow management
DESCRIPTION
Cashflow advice and tips for small businessesTRANSCRIPT
Improve Cash
Collection
Forecast Regularly
Analyse Expenditure
Extend Payment
Terms
Cash Flow Management
Made Simple
Most small businesses only just manage to keep their heads above the water.
They struggle to pay employees and debtors.
If they followed a few simple steps they could:
Achieve financial freedom
and spend money on revenue generating projects.
Top tips to keep your cash flow positive
Keep your suppliers to a
minimum, it is better to
have a few key
suppliers.
Use your increased
spending power to
leverage better
payment terms.
Set up a robust
payment authorization
process.
Pay suppliers on time,
but not earlier than
necessary.
If possible pay your
suppliers after you have
been paid by your
customers.
Credit check all customers before doing business with them
Offer a discount for early payment
Consider a factoring company to guarantee fast payment
Make sure that your payment terms and payment due date
are on every invoice you issue.
Run a report on all outstanding debts on a weekly basis
and pursue all outstanding debt.
Get senior management involved in cash collection
process with long-term debtors.
Provide your customers with as many payment options as
possible.
Consider ending your business relationship with customers
with a bad payment history.
Small Businesses should forecast their cash flow at least on a weekly basis.
When preparing a cash flow forecast you must remember cash and profit are not the same thing.
You could make a profit, but still lose money.
Your cash flow forecast should contain an estimate of when you think will be receive money into your business and when you will have to pay out.
Each week or month you should review the forecast against your bank statement.
This will help you pick up on any variances or discrepancies and will improve your forecast in the future.
Contact Us for help with Managing Cash Flow
www.arinobe.com
+44203 286 7829
arinobe_sme
+447825 002 908
arinobe_sme