When your business would like to maximize your cash flow, check out the following strategies and helpful hints to managing your company’s finances.
Business Cash Flow/Accounts Payable
The first thing you will want to do is to look at how you could improve your accounts receivable and your accounts payable. When you look at your accounts receivable there are numerous things you could try. You could offer customers the ability to pay your business on a retainer. This would give you a steady stream of money. Make sure that you have competitive pricing. You want to sure that you aren’t charging too much or not enough.
You could also offer customers an incentive by offering an early payment discount. Individuals like to receive discounts. If you set earlier deadlines it could help in ensuring that money is coming in at different times. Don’t extend credit. To handle any delinquent accounts set up a collection policy. Make sure that your billing statements are clear and itemized. This will help your customers in knowing exactly what they are charged for, when it’s due and how much they owe your company. If you have customers that will an extended contract then asks for their payments to be divided. Once you receive payments deposit them.
Accounts Payable
When you are looking at accounts payable you will want to try and compare the prices and the terms that you have with the different suppliers. You could ask your suppliers if they will offer you an early payment discount. By utilizing this option you will be paying less. You could ask certain vendors if they extend payments. This would help as you are trying to figure out your cash flow.
You will want to prioritize your bills. You will want to pay the essential bills, for example payroll. You can utilize the automated bill pay system through your bank when you want to pay your bills. You could also get a business credit card. This could be used when you need to pay charges. When money comes in, pay the credit card off. You could even try having a business credit card for specific employees. This card would only be used to make payments quickly.
These are some examples of ways to help in maximizing your cash flow for your business. As you see your accounts receivables increasing you will find that you are more at ease.
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