10 Cashflow Strategies For Small Business
1. Get Excel or a free version of some spreadsheet software.
2. Plan your Weekly, Monthly and Annual outgoings in a list.
3. Plan your Weekly, Monthly and Annual income in another list (conservatively forecast if you don’t know it).
4. Merge the two and add your bank balance at the beginning and using simple formulas plan out what your balance will be at any time in the year ahead.
5. Identify vulnerable weeks and months where cashflow (available funds to cover costs) is low and focus on improving them.
6. Plan expenditure well in advance, allowing a buffer for emergencies and unexpected outgoings you hadn’t already got on the list.
7. Make sure people pay you on time – usually by taking payment upfront if possible or until they have proven their relationship with you, by calling them 1 week BEFORE the invoice is due to check they have it and find out if there is any reason why it wouldn’t be paid on time. Or collect a deposit on your work and offer a pay-as-you go plan where they pay you weekly and you hold a deposit (such as two weeks) for the last two weeks of your work.
8. Spend as much time each day (I’m down to a 5 minute check each day) as you need to check that everything is coming in and going out according to the plan.
9. Measure any monetary decisions on income/outgoings against the plan inserting them in the list where appropriate to gauge where the decision may take you in the future.
10. Work hard to negotiate all costs down and build happy long term customers that pay on-time and well, and that come back repeatedly to spend more each time!