Cutting Expenses In Your Business To Improve Cash Flow
You need money to keep your business running, but many business owners experience cash flow problems that put the future of their business at risk
. Luckily, there are many remedies to cut expenses in your business and improve your cash flow situation. Let's explore these options:Don't buy equipment new. This is an important first step to freeing up your cash flow. You can get a great price on used or reconditioned equipment that works just as well as new. After all, after it is used, it is used and no longer new.
Change your banking strategy to increase cash flow. If you are charged for deposits, then deposit less. If you are charged for paying bills, try to make larger payments to bring down your total number of payments. Visit other banks and see if they charge a smaller fee than your current bank.
Get discounts for services to boost your cash flow. Just as you might give your own loyal customers discounts, you should try and get discounts from companies who you are loyal to. Some ideas are a cleaning service or landscaping service that you have hired for many years. See if they can bring your costs down to help your cash flow situation.
Shop around for a better deal to improve cash flow. If companies whom you are loyal to are not willing to give you a loyalty discount, then there is no incentive for being loyal. In this case, you might want to shop around to see if you can find a better deal for those services. Them same goes for any new services that you may need. Make sure you are getting the best deal before you start a relationship with a company and ask about loyalty discounts up front, so that you dont run into cash flow problems in the future.
Time your deliveries in get better cash flow. Many carrier companies charge more for overnight deliveries and less for afternoon deliveries, so timing your deliveries right can save you some money and enlarge your cash flow. Also, try to stay away from expedited deliveries if possible, as they cost much more than regular deliveries.
Bring your debt under one roof to grow your cash flow. With multiple lenders come multiple interest rates and multiple minimum payments. You can get rid of both of these by consolidating your debt with one lender. One minimum payment means that you will be able to put more money each month towards the principle of the debt and one interest rate will allow you to keep track of how much you are spending on this expense and allow you to negotiate this rate with one phone call.
Apply for credit cards that have an interest free period to increase your cash flow. This period will give you extra time to pay off the debt before the extra expense kicks in. It can be effective to carry balances from a high interest card to a no interest card, but watch out for hidden 'balance transfer' fees.
Lastly, make sure you check every invoice or statement that comes in your mailbox. Humans and technology can make mistakes, and there are often mistakes found on invoices and bank statements. It is important for you check these over, while keeping an eye out for costly mistakes that decrease your cash flow. Many companies have so many invoices and statements that they miss these mistakes and lose out on much needed capital.
Employing these tips will help you control your expenses and improve your company's cash flow situation. Saving, eliminating expensed and correcting errors all work together to keep more capital in your company's 'pocket.'
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