5 Tips to Avoid Cash Flow Issues 58

5 Reasons Why Rewarding Customers is Crucial for Business Success - let's reach success blog

The following article is a guest post.

Every successful business, especially those that manage to stick around longer than a few months, understand the importance of healthy cash flow.

No matter how you look at it, cash flow is the one thing that will keep the business doors open if utilized properly and with mindfulness. And while small startup companies believe heavily in pushing sales, setting up marketing campaigns, and trying to increase the profit margin, they tend to forget about the cash flow. In fact, they notice the problems when the damage is already done.

The companies you see doing business year in and year out, most likely keep a very strict eye on cash flow transactions. And that is why they are able to maintain their success in the long-term.

Here are some of the ways they keep their cash flow efficient and healthy.

1. Zone in on Your Accounts Receivable.

Getting sales is exciting and seeing clients return might be even better. But none of this will actually mean anything unless the money is “flowing” in. In other words, a good system needs to be established where the client gets a price. This is followed by an invoice, and ultimately their payment for the product or service.

If you have the type of company that does contract-based work, such as construction, it will serve you well to get a down payment. With this down payment, the work can start at no extra cost to you, and the client provides the initial funding.

When the job is finished, you can request the rest of the payment, and be diligent in this regard. You don’t want clients to take their casual time with payments because you need to be in a position to handle your account payables if you are going to determine accurate profits.   

2. Handling Vendors.

After you successfully implement a system your clients can follow with timely payments, it is time to focus on the cash outflow.

But unlike your system, you want to negotiate with the vendors for as much time as possible for two reasons. The first is that you don’t want too much pressure to make payments from your side. The second reason speaks to your clients who fail to make payments on time.

If you are dealing with cash for deliveries the it might also be worthwhile to have some systems in place to detect fake cash.

3. Set Up a Cash Reserve.

The first thing you will learn about business is that there are good days and bad days. Even the most successful companies run into situations where things get tight and sales drop, even with strong cash flow strategies in place. And if the sales aren’t dropping, clients aren’t paying, leaving you with bills that keep piling up.

Those successful companies survive these situations because they have a cash reserve, which is specifically for times when clients aren’t paying. See it as an emergency fund if you will, and when you start your business, try to have as much money in the bank as possible.

4. Always Have a Line of Credit as Backup.

In some cases, when the bad spell continues beyond your cash reserve, it’s a good idea to have a line of credit as a backup.

Naturally, this is not a lifeline you are going to use unless it is completely necessary. But having that lifeline can save the business. These are especially useful when unexpected surprises hit at a time when you can’t afford it.

5. Make Cash Flow Tracking Easy Through Technology.

It might not be an easy task to make sure the cash flow stays in a healthy place, but that doesn’t mean the “tracking” part has to be complicated as well. In fact, you want to make it as easy as possible to see where the money is going and where it is coming from.

With the right technology, you can start tracking the cash flow with pinpoint accuracy today. In other words, forget about the old-school ledger system if you want to make things a lot easier for yourself.

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5 Ways to Boost Your Business Revenue 7

5 Ways to Boost Your Business Revenue

Every business strives to increase their profit margin to run their operations, expand services and offer more to the customers. But this is easier said than done, especially in today’s environment where competition is stiff.

Businesses don’t foster if they don’t get enough sales and when there aren’t enough sales, the revenue is bound to decline. However, that’s not something which cannot be changed. It takes a few effective strategies and creativity to bring in more sales and boost your business revenue.

Here are 5 ways to boost your business’ revenue:

1. Invest in Online Marketing

A smart move to capture the audience and generate sales is to target people over the internet.

There are more than 3.2 million active users who use the internet, and the number is only growing with more and more people now having access to the web.

These people are your target audience and you only need to reach them to be able to give your business a boost. However, simply spending money to market a business won’t bear much fruit, marketing needs to be done in the right manner.

Social media is a savior that has been providing businesses with the countless advantages they’ve been dreaming about. The best thing about it is that there’s little to no investment when it comes to engaging with customers on social media.

As per statistics, it only takes 5 engagements and creative/informative posts on Twitter and Facebook to do the magic and attract users to your business.

Social media can help bring audience to you, but then it’s up to your services and products to convert them into successful sales and earn good revenue.

2. Automate Processes Where Possible

What is Benchmarking Analysis and How Can It Benefit Your Business

How you manage your business gets to play a very important role in how much money you make or how much money you save.

For example, a business having a manual system of taking orders, keeping track of sales information and maintaining inventory will face time-related issues and increased costs. This can be solved by automating business processes where applicable.

A lot of businesses prefer to use an inventory management software to automate processes. Such tools help to reduce overhead costs, speed up processes, decrease complexity and in the end, increase revenue by speeding up the overall flow of the business.

3. Listen to The Customers

Increasing business revenue requires to look into a lot of things but most importantly, it requires to make the customers content with your products/services.

A lot of businesses make the mistake of not delivering what the buyers need. Hence, they keep on losing customership, get lesser sales and the revenue keeps on dropping.

Nokia is a good example of this. The company did not change with changing times and today is at the bottom.

If you’re a small business looking for ways to grow then it is time to add new products to your arsenal. You can engage with customers by creating polls on your social media profiles and determine what they need.

Mature businesses should also engage with customers to determine if the products they’re offering are enough or do they need to replace a few old ones with new ones.

4. Target Custom Audience

One of the fastest ways to generate revenue is to talk to customers who are interested in your products. SEO can help you find such customers if you optimize the content for a relevant audience.

Hire SEO professionals to target a custom audience so that you can have increased sales and generate more revenue than before.

5. Offer Discounts

There is a large number of people who look for discounts on various products and services.

In fact, about 20% people agree that there is a high chance of them buying a product – even if they do not need it – if the product is offered at discounted rates.