Every business experiences cashflow problems from time to time. You have assets, you have business coming in, and you’ve got contracts arranged for the future– but you don’t have a lot of spare cash floating around. Without a strong operating cashflow, you can find yourself struggling to work on expansion plans, or even pay your bills.
A cashflow issue is not a sign that your business is inherently troubled; often, the situation is usually short-term, when an amount of money is tied up in another area of the business. However, while not critical, it is nevertheless possible that you return to your normal cashflow status as soon as possible – and here are a few ways you can improve the health of your business’ coffers.
#1 – Suspension Of Employee Benefits
No business owner wants to do this, but sometimes, it’s necessary. It’s important to explain to your employees why you are having to suspend their benefits, reinforcing that the issue is only a short-term solution. If you are honest and promise to reinstate benefits as soon as possible, you shouldn’t have too many problems explaining to your employees that this step is necessary – just remember that you need to give up your benefits as well.
#2 – Switch To Pay-As-You-Go
One of the biggest drains on cashflow is maintenance costs. You have to pay for your office to be cleaned, your computer equipment and data storage, and all of the other small extras that can cause serious damage to your finances.
When cash is tight, it’s far easier to switch to pay-as-you-go methods, so you can free yourself from the burdening of a constant monthly outgoing. You can still hire these essential services as and when you need them, but you avoid the regular, definitive payment that can stymy cashflow.
There are a few ways you can free this up. Cancel your cleaning contract and only hire in cleaners as and when; once a month can be manageable in the short term. If you’re paying a lot for storage and maintenance of devices and data, then it’s worth contacting the likes of Prosyn, for cloud computing help. Storing data on the cloud is far more effective, and cheaper, than hard copies that can be expensive to maintain. Exploring options like these, which can be managed on a pay-as-you-go basis, could be far healthier for the financial status of your business.
#3 – Sell Old or Excess Stock At Discounted Rates
If you have old stock sitting around just gathering dust and needing to be cleaned, then have a clear out of junk and sell it on at sale prices. If the stock is achieving nothing but causing clutter, then what’s the point of keeping it?
#4 – Contact Former Clients With Special Deals
If you need to raise revenue quickly, it’s far easier to speak to old customers and try to entice them to a new order, than it is to invest the time and energy required for new customers. Make a few calls, send emails, even contemplate offering a special “returning customer” deal– hopefully, someone will bite, and your temporary cashflow glitch will be eased.
Hopefully, the above choices will help to improve your finances in the short term, while you wait for your cashflow to return to normal.