Cashflow is the real or virtual movement of money. While most of us have the general sense of what cashflow involves, many business owners struggle with adequate and streamlined cashflow management.
Don’t worry, it happens to the best of us…especially small business owners.
Want to know how to manage your cashflow better in 10 easy steps?
Read more from your local Belmont accounting team at Llara Tax & Accounting to find out more.
1. Avoid spending on non-essentials
Planning your expenditure for the next month, quarter or even year will save your business time and money in the future.
We budget in our personal lives (some of us better than others), so why don’t we for our business lives? Considering non-essential expenses in the context of your financial (cashflow) projections and if possible, staggering or delaying these purchases where appropriate.
2. Check your inventory regularly
Utilising a strategic approach to your inventory management is something you need to be doing.
Why?To avoid the unnecessary costs associated with poor stock management. Also, inventory checks will ensure you’re not keeping excess stock.
How can you do this? Start using an inventory management system and monitoring your inventory levels on the regular (1-2 times a year at minimum).
3. Consider Cloud accounting
Cloud accounting software allows you to access your financials anywhere, anytime.
We can help you find the best Cloud accounting services suited to your business.
4. Document your debt collection process
Everybody loves a paper trail. They make running a business that little bit smoother.
As you might have experienced firsthand, late payments can put a considerable strain on your cashflow.
So, what should you do? Make your customers and clients aware of your debt collection process and the action you will be taking if they fail to pay on time.
5. Keep on top of your invoicing
Small businesses must keep on top of efficient invoicing to maintain a steady cashflow. Do this by sending invoices ASAP that are clear with your terms and follow up on unpaid invoices.
6. Manage expansion
It’s important not to get in over your head when the success of your small business grows strongly and quickly. Remember growth should be sustainable, not quick and risky.
Talk to your Belmont Accountant about maintaining good cashflow for your growing business and managing a sustainable expansion.
7. Plan for emergencies
In business, expect the unexpected, especially that of cashflow shortages. Formulate a plan to access additional capital in emergencies.
8. Rent instead of buy
Why buy an office, machinery and/or business vehicle when you could lease them? This is a smart strategy for managing your cashflow.
9. Stay on top of costs
It’s oh-so-easy to lose track of not only time, but expenses too, when work is incredibly busy.
Remember though, that a handful of high-cost months can put a serious dent in your cashflow.
Your trusted accountant can help you stay on top of costs.
10. Trust in your local Belmont business accountant
Llara Tax & Accounting are here to take the complexity and confusion out of your accounting and taxation needs.
As a family owned and operated small business, we understand all the trials and tribulations that go hand in hand with running a business. With our personal, professional and proactive approach to our clients, you can rest assured that you’re in good hands.
Are you a local business in Belmont or beyond and need an accountant to help you manage your cashflow?