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For small business owners in particular, maintaining a decent cash flow is fundamental to staying afloat, particularly during the quieter periods such as the Christmas holidays. It’s a simple equation really: no cash = no business, and so keeping on top of your cash flow has to be a top priority. Bartercard knows small businesses inside out, and in this article they share some tips on how you can maximise the cash flow in your SME.
First up, you need to invoice quickly. It should come as no surprise that if you don’t send through your invoice until two weeks after you’ve completed the work, that payment isn’t forthcoming until another two weeks at least. Get in the habit of preparing and sending invoices straightaway. What’s more, send them by email and that way they will get to the relevant person immediately. And while you’re at it make it easy for the customer to pay the invoice by providing your online banking details.
Secondly, make it clear to customers what your payment terms are. A reasonable timeframe for the average small business could be 14 days. Whatever terms you plump for, set clear expectations for your clients. You should also invest in reliable accounting software, it will be a great time saver and will allow you to focus your energies on other important tasks.
Thirdly, you need to focus on cash flow not profits. If your cash flow is in order, then it is a follow on effect that your profit will also be in order. You should also consider introducing incentives or fixed rate payment packages, and, of course, use Bartercard.
Bartercard is a valuable way to conserve cash flow by sourcing products and services without opening your wallet, using your trade dollars instead of cash to pay for services like bookkeeping and accounting, setting up your e-commerce store, printing, advertising, website, graphic design and SEO. At Bartercard there are endless ways to conserve the cash flow essential in business.
Effective cash flow management is critical to the success of your enterprise, so give your business the best possible chance by using these tips and keeping on top of cash flow, and for more information on how to increase profits, retaining customers and customer retention techniques please go to www.bartercard.co.nz .