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5 ways to improve your small business cash flow
Cash flow is crucial in any business. A healthy cash flow ensures that you have the funds to pay your bills on time and to grow.
Unfortunately, many small businesses struggle to maintain a consistently healthy cash flow. If you’re in that situation, here are 5 ways that you can improve your cash flow.
1. Shorten your customer payment terms
If you’re currently offering your customers credit terms of 30 days or more, do you really need to? We live in the electronic funds transfer (EFT) era. Customer Payment upon receiving an invoice (or within 7 days) is becoming increasingly common.
The days of having to allow for posting your invoices to customers via snail mail or having them post you a cheque are long gone.
2. Allow more customer payment options
Do you give your customers multiple payment options, like credit card, EFT, BPAY and cash? The more payment options you give your customers, the more likely it is that they’ll pay you on time.
3. Provide a discount for on-time customer payments
Offer your customers a discount to encourage them to pay you on time. You’ll likely find that your customers will prioritise paying businesses that do.
4. Use online invoicing software
Online accounting software like Xero can help you to send customer invoices quickly and easily, as well as automatic payment reminder notices.
5. Hire a bookkeeper
A bookkeeper will regularly analyse your cash flow and make recommendations to help you keep on top of your business finances.
How we can help
At Scorpion Bookkeeping, we’re a Xero-certified advisor. We can help you to set up a bookkeeping system to help you manage your cash flow effectively.
We can also help you with any bookkeeping support services that you may need, no matter what type of business you have. We currently have clients in a diverse range of industries in South Australia, Victoria and New South Wales.
Contact us today to find out how we can help your business!