WinWeb

Improve Your Cashflow Management

January 30, 2010

Cashflow is often described as being the lifeblood of small businesses. Without careful management of cashflow a business can quickly get into financial trouble. A lack of cash can be hard to remedy, especially if the business needs to purchase supplies before it can make further sales. Without additional investment or a bank overdraft to help out the business, it will often lead to disaster.

However, there are number of small things you can do to avoid this situation occurring. The most important of these is receiving payment from customers as soon as possible, because until you have the money in the company account it is useless to your business. It is advisable to offer small incentives for swift payment to encourage customers to pay their invoices as soon as possible.

You should also be trying to do the exact opposite when it comes to paying company bills. Take advantage of a 30 or 60 day due date and use that time to set aside enough money to pay for it. With careful cashflow management you can make far more efficient use of your money.

Another important thing to remember is that your inventory is not cash until is sold. You may think that you will save a few pennies by ordering in large quantities, but if it cannot be sold then it is essentially just dead weight for your business that you may end up selling at a discount.

It is also advisable to make use of a Cashflow management tool like the one within OnlineOffice in order to make the process far simpler; it is fully integrated into the Accounting module and will give you much greater control over your business finances.

Try WinWeb’s cashflow management tool free for 30 days, just by visiting www.winweb.com !