If you make any resolution in 2018, then it should be to stabilise your Cash Flow. A healthy cash flow forms the foundation of a successful business, and without skilful management, your business will suffer. To help you to improve your cash flow this year, Commercial Domestic Investigations are sharing some easy-to-follow tips.
Cash flow forecasts can help you to predict the future of your business. Make realistic estimates of your income and expenditure; this can be done using previous sales history or market research. Forecasting your cash flow like this can alert you to any months when you may experience a shortfall. Similarly, it can help you to see which months you can expect greater sales, allowing you to plan for reinvestment. You should regularly review your forecast and make adjustments, for example, if you have made some unexpected sales or an unplanned cost needed to be paid.
Wherever possible, pay your suppliers on time. Not only is it good business practice but it improves your credit score and improves your business relationships. If you’re paying the same price on a regular basis, then consider setting up a direct debit or standing order so that you never miss a payment. While paying on time is encouraged, to keep your cash flow healthy then don’t pay the invoice too early but just in time for the due date.
Keep an eye on your invoices and customer accounts; it only takes one or two late payments to cause some serious damage to your cash flow. If you are operating on payment terms, then these should be clearly explained to your customer before entering into an agreement. If they agree, ensure that they have signed either a contract or Terms and Conditions to ensure that they have understood. Reinforce your payment terms on the invoice that you send and confirm receipt of the invoice so that the customer can’t claim they’ve never received it. Resolve any problems that the customer may have as soon as you can so that your payment is not delayed.
If late payments are causing your business a lot of hassle, then get in touch with Commercial Domestic Investigations. We offer a range of services to help you with your credit control, including an invoice collection service. Let us collect overdue accounts so that you can focus on generating new business and improving supplier relationships. Contact our team on 08444 159200, use our contact form or email [email protected]
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