Keep cash flow to an optimum by observing the following suggested methods:
– Keep your payroll bill down to an absolute minimum – however, always pay good money to good employees or they will walk!
– Try to avoid signing long-term rental agreements and if fancy offices are not necessary don’t bother with upmarket office space, especially if your customers rarely visit your business.
– Don’t overpay yourself – you only need to take out what is enough to feed yourself.
– Keep a close eye on staff travel and entertainment and avoid issuing staff with company credit cards and mobile phones!
– Fancy office furniture hurts the bank balance and is not necessary unless you are in the type of business that needs to impress clients. Secondhand or liquidation stock furniture is the best option and will save you a small fortune!
– Keep an eye on your supplier costs and where possible play one against the other to keep them keen and your profits high.
– Always call your customers that owe you money and make sure you keep a close eye on “Debtor Days” (Debtors days is the time your customers take to pay you from the invoice date)
– Pay your suppliers on time, but if you are going to be late paying call the supplier concerned and always, always stick to any date agreed between you.
– Don’t waste electricity by leaving computers and printers on over night – this is also good for the environment too.
– If you are out for a business meal, if the other side offers to pay, never pay!
– Get your invoices out on time and on a regular basis – the sooner you invoice the sooner you get the money!
– Create good systems in your business that will help to save time and will help you to keep employees to a minimum.
– Delegate jobs to the lowest possible denominator in the business – having good systems will help with this process.
For help with preparing a cash flow forecast click this link “cash flow forecasting made easy”