{"id":345,"date":"2016-12-05T09:31:58","date_gmt":"2016-12-04T22:31:58","guid":{"rendered":"https:\/\/marshallfreeman.com.au\/blog\/?p=345"},"modified":"2017-05-10T14:02:27","modified_gmt":"2017-05-10T04:02:27","slug":"5-cash-flow-essentials-for-every-small-business","status":"publish","type":"post","link":"https:\/\/www.marshallfreeman.com.au\/blog\/5-cash-flow-essentials-for-every-small-business\/","title":{"rendered":"5 Cash Flow essentials for every Small Business"},"content":{"rendered":"<h1 class=\"p1\">5 Cash Flow essentials for every Small Business<\/h1>\n<p class=\"p1\">Looking to increase cashflow in your business? Perhaps its time to start\u00a0thinking like a blue chip company. \u00a0The idea might sound overwhelming but applying\u00a0some simple strategies used by the big guys you too can\u00a0confidently increase cash flow and decease bad debt in your small business.<\/p>\n<p class=\"p1\"><div class=\"gap\" style=\"line-height: 30px; height: 30px;\"><\/div>\n<h3><b>1. Speed up customer payments<\/b><\/h3>\n<p class=\"p2\"><span class=\"s2\">How do you do this? Make it easy for customers to pay you! Consider offering payment terms that give you instant cashflow such as Visa\/Mastcard and EFTPOS.<\/span><\/p>\n<p class=\"p3\">Ask yourself, which of your customers should you extend credit? People are use to paying C.O.D. or even pre-paying for goods. If you are concerned your existing customers wont like paying upfront perhaps offer them a discount for pre-paying.<\/p>\n<p class=\"p3\"><div class=\"gap\" style=\"line-height: 30px; height: 30px;\"><\/div>\n<h3 class=\"p3\"><b>2. Baggage, who needs it!\u00a0<i>Don\u2019t hold stock you don\u2019t need<\/i>\u00a0<\/b><\/h3>\n<p class=\"p4\">Keeping stock is heavy, it reduces cash on hand, and takes up space to store \u2013 makes sense right?\u00a0Start by assessing what stock you have on hand,\u00a0how long has it been there? Does it move slowly? How much is it costing you to hold.<\/p>\n<p class=\"p4\">In small business, along with every other role, you\u2019re the supply chain manager.<\/p>\n<ul>\n<li class=\"li1\">Exercise discipline and only base stock orders on real customer demand.<\/li>\n<li class=\"li1\">Track employee purchasing, are they over ordering? Do you have procedures in place to reduce wastage and organise stock for easy access?<\/li>\n<\/ul>\n<p class=\"p4\">By being aware of the inventory you\u2019re holding and how it flows in and out of your business, the answers on how to refine this will come.<\/p>\n<p class=\"p4\"><div class=\"gap\" style=\"line-height: 30px; height: 30px;\"><\/div>\n<h3 class=\"p4\"><b>3. Don\u2019t pay earlier than necessary (unless there is a benefit)<\/b><\/h3>\n<p class=\"p4\">Deloitte\u2019s\u00a0advocate in their <a href=\"https:\/\/www2.deloitte.com\/content\/dam\/Deloitte\/ca\/Documents\/finance\/ca-en-FA-strategies-for-optimizing-your-accounts-payable.pdf\">Working Capital series<\/a>\u00a0to\u00a0ask\u00a0suppliers if they offer discounts or rebates for early payment.<span class=\"Apple-converted-space\">\u00a0 <\/span>In a \u2018you scratch my back I scratch yours\u2019 kind of arrangement. This type of arrangement can reduce costs and\u00a0enhance your supplier relations.<\/p>\n<p class=\"p4\"><div class=\"gap\" style=\"line-height: 30px; height: 30px;\"><\/div>\n<h3 class=\"p4\"><b>4. Plan timing of major expenditure and don\u2019t impulse buy!\u00a0<\/b><\/h3>\n<p class=\"p4\">Start with your business priorities.<span class=\"Apple-converted-space\">\u00a0 <\/span>Make a list of purchases that are necessary to operate right down to the Herman Miller Aeron office chair you\u2019d like to snuggle into daily \u2013 not a priority, and will only decrease cash flow, but\u2026 it\u2019s pretty right?<\/p>\n<p class=\"p4\">Now, hold that thought and take note of number 5.<\/p>\n<p class=\"p4\"><div class=\"gap\" style=\"line-height: 30px; height: 30px;\"><\/div>\n<h3 class=\"p4\"><b>5. Invest idle cash \u2013 make it work for it\u2019s keep! (<i>unlike your teens)<\/i><\/b><\/h3>\n<p class=\"p4\">How do you figure out how to make your savings work to increase cash flow too?<\/p>\n<p class=\"p4\">What does your business need to expand? No doubt you have your ideas, every entrepreneur does.<\/p>\n<p class=\"p4\">Let\u2019s break these ideas down into bite size successfully planned pieces:<\/p>\n<ul class=\"ul1\">\n<li class=\"li1\">Start by looking at how you can use your money to it\u2019s full potential, do you have your savings currently in a term deposit, what is the interest, how is that serving you, could you find a better deal somewhere else?<\/li>\n<\/ul>\n<ul class=\"ul1\">\n<li class=\"li1\">Next, expanding and refining how your business runs can increase profit, is this an option? What investments can you make into your business that will increase profit and in turn, you guessed it \u2013 cash flow.<\/li>\n<\/ul>\n<ul class=\"ul1\">\n<li class=\"li1\">Now take a step back, do your lists 4 and 5 overlap?<span class=\"Apple-converted-space\">\u00a0 <\/span>Is there a clear flow of potential expenditures and business expansion developing?<span class=\"Apple-converted-space\">\u00a0 <\/span>There it is, the inception of your investment plan &#8211; plain and simple.<\/li>\n<\/ul>\n<p class=\"p4\">Slow\u00a0and steady wins the race where major spending in small business exists, so ensure you always have excellent liquidity (and this doesn&#8217;t mean a well stocked wine fridge!)<\/p>\n<p class=\"p4\">Need more help? Creel Price\u2019s book \u201c<i>The one thing to win at the game of business<\/i>\u201d will send you on your way when it comes to making the right decisions.<\/p>\n<p class=\"p4\"><div class=\"gap\" style=\"line-height: 30px; height: 30px;\"><\/div>\n<h3 class=\"p1\"><b>A match made in heaven; you + sleep + cash flow<\/b><\/h3>\n<p class=\"p1\">It&#8217;s\u00a0important to sleep, as a small business owner this might be hard, but <a href=\"http:\/\/www.inc.com\/oscar-raymundo\/how-to-maximize-the-two-most-productive-hours-of-the-day.html\">studies show a good nights sleep<\/a> will have you hit the ground running,\u00a0refine your cash flow and have you\u00a0meeting your ATO obligations.<\/p>\n<p class=\"p1\">Tap into your well-tuned discipline, work on your business, not just in it. <span class=\"Apple-converted-space\">\u00a0 \u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Looking to increase cashflow in your business? Perhaps its time to start thinking like a blue chip company.  The idea might sound overwhelming but applying some simple strategies used by the big guys you too can confidently increase cash flow and decease bad debt in your small business.<\/p>\n","protected":false},"author":1,"featured_media":286,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts\/345"}],"collection":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/comments?post=345"}],"version-history":[{"count":23,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts\/345\/revisions"}],"predecessor-version":[{"id":386,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/posts\/345\/revisions\/386"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/media\/286"}],"wp:attachment":[{"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/media?parent=345"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/categories?post=345"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.marshallfreeman.com.au\/blog\/wp-json\/wp\/v2\/tags?post=345"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}