Keys to Keeping Your Small Business Afloat Amidst Tough Times

They say revenue is vanity, profit is sanity but cashflow is reality. Improving your cashflow can give you the money you need to carry you through lean times or help grow your business.
Here are a few ways to improve your cash inflow:

  • Collect accounts receivables faster:
    • Ask your customers to pay you in advance. If not the full amount, ask for a 50% deposit up front
      which you can use to buy materials.

    • Ensure that your clients are invoiced immediately after the completion of a sale.
    • Monitor your accounts receivable. If clients are not up to date, give them a call.
    • Offer a discount to clients that pay quickly.
    • Insist on doing credit checks on all new non-cash customers.
    • Go after more cash business and refuse to do business with slow paying customers.
    • Encourage your customers to pay using their credit card.
  • Pay accounts payable slower
    • Ask your suppliers to allow you to take 30 or 60 days to pay.
    • Pay by credit card to take advantage of the delay between your purchase and when you have to
      pay off your card balance.

    Photo credit Alireza Teimoury

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8 responses to “Keys to Keeping Your Small Business Afloat Amidst Tough Times

  1. I like the point about…”revenue is vanity, profit is sanity but cashflow is reality”…Great work. Keep working.

  2. Due to the recession, there are fewer opportunities for online businesses. However, as the payment for online advertisement has been greatly reduced by the advertisers, for online stores, it might be a good time to promote themselves online at low costs instead of selling.

  3. It is very informative. Thanks a lot for sharing it. I've bookmarked your blog. Keep working.

  4. Great Work.I'd like the thank the blog owner for posting it.Great Comments. I'd like to thank the readers for sharing more helpful and relevant information.

  5. These days, increasing amount of businesses pay more and more attention to the potential of online marketing on social network as it is becoming increasingly influential.

  6. You've offered a lot of great tips. It's obvious that you've put some deep thoughts into the topic. Thanks for sharing the deep thoughts.

  7. There is a financial crisis all over the world today.The recession is bringing increasing pressure for almost everyone. It is becoming extremely challenging for small businesses to stay in practice. You've offered some great tips. Thanks for sharing man.

  8. There is also a growing vote of no confidence in the major Wall Street firms currently. But the situation in the market place remains tough for small businesses.

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