Cash flow management means adjusting the cash flow of business through evaluation and monitoring process. It is most important, because if you not adjust your cash flow within a year, then you will not survive the next year. According to U.S. Bank, 82% of businesses fail due to poor cash management. If your business spend more money than it earns, you have a cash flow problem. The most important fact for small business is avoiding extended cash shortages, and the reason is if too much gap occurs between income or expenditure. Your business would not be able to stand in business market. If you don’t want to occur any problem in your business cash flow then follow these tips.
Tips for better cash flow management
1. Monitor your cash flow regularly: Monitor every transaction of money flow means how much money in and out in the business. Make every record of every transaction and use security also.
2. To Maintain some cash reserve: Cash reserve means emergency funds, which is used at the time of money shortage. If you reserve sufficient money in your business account, then you can easily solve the problem.
3. Use your cash flow worksheet: In this maintain aggregate data regarding all cash inflows and outflows of a company. You can do it in excel or what you use. Maintain valuable data.
4. Have made payments easy for customers: Always try to make payment mode as easy as possible for customers. In today’s life online payment is most popular.
5. Improving receivable: Ask customers to make deposit payments at the time orders are taken. Offers discount to customers who pay their bills quickly.
6. Enhance sales with creative motivation: With creative ideas increase the sale like to give discounts, provide extra service for the same price, sponsoring a contest.
7. Designate a cash flow supervises: For better facility and proper cash flow management higher trustworthy employee. He is always updating you.