A strong cash flow is essential to a healthy, thriving business. Smart, small businesses will follow various strategies to monitor and increase all money. As a small business, what can you do to better manage your cash flow? When looking at your finances, how can you continue climbing in the black?
Here are a few expert tips to help you better manage the cash flow in your small business.
1. Make Invoicing a Priority
Do not wait to send the invoices for completed services. There is little benefit in waiting. Establish a process so once the work is complete, you can send invoices immediately. This will speed up the payment process and you can receive payment for work in a more timely manner.
However, invoicing is not simply sending invoices right away. It also involves making sure the invoices are easy to read and provides all important information. Make sure all necessary data is easy to find, such as the due date, the amount of money due, how to make a payment, etc. This will reduce questions and concerns that could delay payment.
2. Improve the Payment Process
What options are available for your customers and clients to pay you? Do you require that the individual physically comes into the office and hands you money? Are you offering any type of online payment options? Do you only require certain payment types? These are small details that can greatly affect how and when you receive payment.
You want to make the payment process as fast and simple as possible, encouraging clients to pay all invoices quickly and on time.
3. Consider Loan Options
In some circumstances, a business loan may be necessary to help you manage a negative cash flow. Borrowing money will help you get a handle on your finances before it is too late.
Do not wait until you are in dire need of the money to apply for a loan. This will not only make the situation more stressful but many banks / financiers are more cautious of these situations and you are less likely to be approved. Visit with a lender before the situation goes from bad to worse.
Additionally, be aware that this might not be the best option for your company and other methods may be just as effective without any long-term consequences.
4. Meet With a Virtual CFO
An excellent CFO will not only take the time to look over your current financial situation but he or she will learn about your company’s financial goals and help you develop plans to reach them. When you meet with a CFO, he or she will review your company’s current state and determine where weaknesses lie and where improvements could be made.
At Hemisphere Accounting, we offer virtual CFO services to help you build your business. We can also offer advice and strategy options to help you improve your cash flow and lead your company to success.
If you are ready to see your company’s cash flow grow, meet with an experienced, professional, and knowledgeable CFO from Hemisphere Accounting. Schedule your consultation here.