The good news is that we’re technically out of the recession. The bad news is, money is still not falling out of the sky.
Every business and every market goes through fluctuations. Whether it’s a competitor opening down the street or a country-wide shift in the marketplace, the tide can turn on your business at any time, and frequently does.
But there are plenty of things you can do other than grin and bear market changes. The way you structure your cash flow can make a HUGE impact on your business’ immunity to market fluctuations.
Here are some ways to improve your cash flow without drastically changing your business
1. Make it ridiculously easy for your clients to pay.
Paper invoices sent snail mail are quickly becoming a thing of the past. Not only do they take forever to get to the client, they also regularly get lost or damaged, as do the paper checks sent in return. (The check’s in the mail? Right…)
Send your clients electronic invoices via email and always include a link where they can pay immediately. You can also easily send payment reminders via email to speed up payments even more. Sending electronic invoices will get you your money faster, in as little as minutes as opposed to weeks.
2. Get your money EVEN faster with working capital funding.
Waiting for clients to pay can put your business’ ability to grow deathly off track. When you need a piece of new equipment NOW, waiting for six months for invoices to get paid only hurts your business. With working capital funding, an outside company essentially buys your customers’ invoices and pays you for them immediately.
The customer then pays the working capital funding firm instead of you. There is a fee for this service, but it gets you access to your money as you need it, which can be a lifesaver when unexpected costs arise that your regular cash-flow measures are unable to cover. Another great benefit to working capital funding is that firms like Capital Solutions Bancorp take on all the risk for unpaid invoices. If a customer neglects to pay an invoice, we take the loss, not you!
3. Check your terms
How long do you allow your customers to go without paying? Check your terms against others in your industry and see if you’re allowing your customers more time than the standard to pay. The faster you get your money, the more money you have to reinvest. Cutting your terms by just a little can make a big difference.
4. Get a business line of credit, just in case
You may never need a business line of credit, but if you ever do, it’s a good idea to already have that relationship in place.With a business line of credit, you can buy more inventory, hire staff, invest in training, open new accounts and take advantage of new business opportunities that aren’t already built into your budget.
Opportunities have a way of popping up when you least expect them. A business line of credit allows you to be ready when opportunity comes knocking.
Get the working capital your business needs by contacting us
Capital Solutions Bancorp helps businesses just like yours get the working capital they need to thrive and grow in any market. Call us today at 800-499-6179 or learn how to get working capital.