Let’s Get Fiscal: How You Can Be Better at Cash Flow ManagementInk Well Mag February 25, 2016 0 COMMENTS
In the past few years, a lot of startups have risen to popularity. Some of them have been acquired by the large multinationals for hefty sums – and for some, this is the point where the business venture can be called successful. But of course, not everyone succeeds. There are more companies that fail after their first few years in business, mainly because of bad cash flow management.
Minnesota’s business development experts say that cash flow management is at the heart of every company. If you want to stay in your industry, you better know where to get and make cash at the right time. But, how exactly do you do this?
These experts have shared a few tips:
Set Clear-Cut Targets
A cash flow forecast goes a long way in projecting whether or not your business is in good shape. It is important to know where you currently stand and where you plan on standing after a few weeks. This is one of the best ways to keep your cash flow under control: by proactively predicting it and setting realistic targets. Have a clear outlook on where you want to take the business and work your way towards that particular goal.
Clarify Payment Terms
The problem with some businesses is that they employ shoddy payment terms with their suppliers and/or customers. As a result, there is no certainty as to how or when they are able to get funding for the daily operations. The best practice is to explain the payment terms from the get-go. Make it clear who pays how much and when. It is important to stay on top of this if you want to be better at cash flow management.
Use Convenient Payment Methods
Lastly, make sure that the people who need to pay you can do so conveniently. Setting up multiple procedures for payment complicates things way too much. This could have a negative impact on your cash flow over time due to missed payment deadlines.
Simple as these may seem, these actions do stabilize the finances of a business. Practice these and make sure your company is on the right track towards growth and success.