Staying on top of your cash flow is a great way to keep an eye on the health of your business. Business owners that watch their cash on a regular basis will tell you that they have a clearer picture. Not just of how much revenue is coming in but also they are more in control of their business expenditure.
Check out our top tips for boosting the cash flow in your business:
Accounting software such as FreeAgent, Sage or QuickBooks makes it simple to review your cash position. Using online software to reconcile your accounts and banking data saves time. And it means your data is more up-to-date than the spreadsheet you last used a few months ago.
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How many recurring monthly, quarterly or annual expenses do you have? When did you last review your utilities, payroll, insurance or other service providers? By not reviewing expenditure regularly, you may be spending more money than you need to. The same applies to the cost of outstanding loans or leasing arrangements.
At Finpoint we can help you consolidate and re-finance existing business loans and other funding facilities with a view to reducing your monthly costs.
Do you have equipment you rarely use or inventory that’s fast becoming obsolete? Why not consider selling it to generate some extra cash?And when you purchase new business equipment, check your leasing options.
By leasing equipment, you can access the latest kit while expensing the lease costs on your business taxes.
Different businesses face different challenges. Clients in a shop will expect to pay you, before they get to take the product home. But what if you provide services remotely or need to send invoices?
The first step is to make sure that any payment milestones are clearly set out before you start. That way clients know when they are expected to pay you. Lets say you are a plumber and have done the work, you could use a mobile app to accept card payments before you leave.
Sending invoices also needn’t be complicated. Many accounting software providers include mobile apps for you to use. You set up a template once and enter each client details’ on the go. This approach also ensures that your invoices are easy to read. And depending on the software you use, may include links on how to pay you.
If all else fails, then you will need to send reminders to chase up payments from overdue clients. In this area, you can again benefit from good accounting software. Since late payment has been a big issue for small businesses, software companies have reacted and included the option to set up alerts. This could be before an invoice becomes due, and in set intervals after the due date.
A healthy working capital buffer is a good way to fend off cash flow problems. But with bank overdrafts less and less available, it is worth looking at other options early.
Thats because lenders generally take a negative view when businesses appear desperate. From their perspective, it is an indicator that the business is not spending enough time on managing their finances.
As a business owner, it is worth considering to prepare a cash flow forecast and to review this regularly. This can serve as a great way to see crunch points ahead of time, and to provide to lenders as evidence on how you run your business. This makes it easier for you to have a discussion around unexpected costs, because it signals to the lender that you are doing your homework. But as everyone in business knows, surprises can and will happen and you can trade your way out of them if you have a good grasp of your finances.
Keeping track of your cash flow is important for many reasons. In terms of providing an overview of your business resource
In the retail banking world, Open Banking is transforming the way customers communicate financial information to third parties by securely sharing
Finpoint is staffed with impartial finance experts that speak your language and are always ready to walk you through the pro’s and con’s of each option before you proceed.
Decide without any pressure, safe in the knowledge you got the best funding solution for your business.
Finpoint has the most extensive funding partner network in the UK. And with over 50 funders that you won’t find on any other platform, our lenders provide hundreds of finance options to help you grow your business.
Plus, access to our services is completely free of charge, helping to lower the overall cost of finance.
