How to improve cash flow

As a small business owner, it is often difficult to juggle supplying products and services whilst keeping on top of your cash flow. Here are 10 top tips on how to improve cash flow and save you time:

  1. Add your Bank Details onto your Invoices to allow your customers to make online payment direct in to your Business Bank Account.
  2. Expand the number of ways your customer can make payment. Give your customers the flexibility to pay via credit card even if you need to charge a small fee.
  3. Take mobile card payments on completion of a service or job. This method allows you take payment instantly and the funds will be in your business account in 3-5 days rather than waiting potentially 30+ days for a customer to pay an Invoice.
  4. Take deposits or payment on account. Having the funds available upfront, will ensure you can pay your suppliers on time and maintain good supplier relationships.
  5. Chase your customers who don’t pay on time. It may be that your Invoice has simply slipped their mind. If you have customers who are regular late payers, enquire as to why and try to amicably resolve the problem.
  6. For Customers who pay on Invoice, you may wish to consider an early payment incentive if they pay within 7 days for example
  7. Check your T & Cs. If your customer continues to make late payment without good reason, notify them about your intention to switch off services.
  8. If you experience problems with non-payment, consider Invoice Factoring, using a Debt Collection Service or taking Legal Advice.
  9. Manage stock levels. Another area of the business where cash flow can often be improved is stock. Practise good stock rotation so that products on the shelf do not become obsolete and work closely with suppliers to reduce stock held.
  10. Keep accurate up-to-date financial records – documenting all customer transactions, how much is due and by when is critical to the financial health of your business. Access to online banking information will save you time and help you keep your finger on the pulse. 

For more information about taking Mobile Card Payments, please click here.