Managing cash flows

The importance of managing your Cash flow is the lifeblood of any small business and how it’s managed will shape the success of your business. Having ample cash on hand will ensure that your suppliers, employees and other vendors can be paid on time.

How can you manage your cash flow?

• Create a budget in your accounting program
• Run profit and loss comparison with budget – comparing your budget to your actual figures helps you to identify areas of improvement.
• Manage your sales
  • Utilise the sales overview to check the status of all sales – this allows you to keep on top of the amounts owed to your business
  • Automate the invoice sending, reminders and statements
  • Provide ability to pay directly from the invoice to improve the promptness of debt collections. Combining online invoicing with a payment service increases efficiencies in the business.
    • Get paid faster, Research shows customers pay 35% faster when connected to a payment service. In addition the program records the payment for you reducing data processing time.
    • keep a clear audit trail – This helps you estimate cash flow and keeps a detailed record for any questions from the customer or ATO.
    • and win back time in your day. Statistics show that small business owners spend 10% of their time chasing late payments, automating reduces that time.
• Manage your purchases
  • Ensure you are entering all known purchases/bills and debts – This way you can avoid any unpleasant surprises as you can use the purchases overview to see all upcoming bills.
• Reconcile the bank accounts regularly ( weekly if not daily)
  • This ensures that the clients are not getting reminders if they have already paid
  • It also ensures you have up to data so that when you look at your cashflow you can see what payments are coming up and if you are going to have a shortage.

Contact us for assistance in setting up the above, monitoring and setting goals. We are here to help.

Cash flow management coaching

Yes we offer cash flow management coaching.

Ask yourself:

• Am I trading profitability?
• Am I putting enough aside to cover my ongoing financial commitments?
• Does my business have enough to spend on myself and others?
• Is my business getting ahead or falling behind?