7 Ways to Increase Your Business Cashflow Immediately

I have met hundreds of business owner over the years who are rushed off their feet with sales, they operate a busy business, but they struggle to maintain positive cash flow, why is this??Well, there are several factors at play when managing cashflow, but they kind of boil down to just a couple of reasons.?You’re not collecting enough cash, or you are spending too much cash.?That said, there are a whole heap of tactics you can use to ensure you are controlling your expenditures and regulating your income.?Something that I see time and time again is lack of financial control, at the very base level, creating a cashflow forecast will help you identify periods of negative cashflow through your business.?Another thing that is within your control is to open a few bank accounts.?Call one account ‘Tax’, another ‘Expenses’, and so on.?Whenever you get cash in allocate 20% straight to the tax account, 5% to another etc so that when the tax bill arrives, there are no surprises, you’ve already got it covered.?Two very simple things you can get sorted in an afternoon.?Here are some more quick wins that will definitely help in turning that negative cash flow positive:

1.?????Send invoices as soon as possible.?I know this sounds obvious, right??Often invoices tend to get sent once work has been completed, well guess what, paying you will be the last thing on their mind.?Send invoices straight away.?And while we are on it – make sure you have invoiced for everything.?Again, it sounds pretty obvious but I guarantee if I went back through twelve months of your invoices, I’ll find stuff that you’ve done for clients that haven’t been invoiced for.

2.?????Shorten your payment terms, and make sure customers pay on time.?Follow up with invoice reminders – as many as it takes.?Like with our children we encourage behaviour we want to see more of and try to discourage negative behaviour, so incentivising early payment and penalising makes sense.?You will start to see those who like praise pay on time or earlier.?Bear in mind if you are incentivising with a discount, that will hit you right in the profit margin, further compounding a cash flow issue.

3.?????An easy win (and I talk about this a lot…) is increasing your prices.?Think about it, the reason you have a cash flow problem is because your expenditure isn’t keeping up with your income, you need to correct the ship.?Do your prices really reflect the compensation you deserve for your time or products??I suspect if you have a cash flow problem the answer is no.

4.?????Another couple of quick wins:?What products aren’t you selling that you could be selling??What can you get your existing customers to buy more of, or in addition to now??This is all about upselling and cross selling.?I always tell people your best next customer is one you already have.?You have spent time and money marketing to your current customers, it just makes sense to try and sell them something else.?You’ve done the hard work, reap the rewards.

5.?????Get rid of dead stock.?I started working with a business owner who was struggling with cash flow, but they had ￡40,000 worth of unused stock in their warehouse.?They sold this exactly one hour after we spoke, meaning most of their problems went away.?Do you have stock you are just holding on to??I bet it’s worth something to someone.

6.?????As well as getting your clients to pay on time – can you negotiate better terms with your suppliers??This is all about closing the cash gap and ensuring cash stays in your bank account for the longest time possible.?My challenge is always how short can you make the cash gap – the time between you must pay for stuff and when you get paid.?Ideally there isn’t a cash gap at all…

7.?????Expand your market.?By opening a few more marketing channels you could significantly increase your cashflow.?Think about who currently needs your product, but doesn’t know about it??What marketing aren’t you doing, for example what social media platforms don’t you use and is there an opportunity for you there??Make a marketing plan will ensure you can cover everything you need to.?At the very least, pick up the phone to everyone and anyone you have ever met online, or in person networking just to touch base.?Don’t stop until you have at least 5 leads.

All of these tips will help drive the cash flow positive in your business.?Whether you focus on marketing, sales, increasing efficiency or something else, you’ll have more money to invest into the growth of your business.

To really get control of your finances and your cashflow under control, you need sustained fiscal discipline.?If you want to know more, feel free to drop me a message.