No matter where your business is today, we can always use a better cash flow and more solid financial standing. If you were thinking that it might be time to tap into some connections you have for extra financing, you might want to do some internal housekeeping first.
It can start by looking at the software you use to organize the financial and sales side of the business. There have been a lot of great new products out there, Microsoft Dynamics Ax comes to mind, that can make a difference. This would not be a bad place to start when considering how to improve your financial outlook. Here are a few more ideas.
Who Owes You?
If you have any outstanding debt from vendors and others, now would be a good time to call those in. There could be a number of perfectly good reasons that this debt is not getting paid. None of them really matter. If you have to, hire an agency to collect. It will be worth paying them their fee to get your hands on that cash.
Review Outgoing Expenses
You might be surprised how much you can save when you start looking at little more closely at your expenses. Look at suppliers and see if you can get a reduction in price for prompt payment. Discuss new terms with your bank.
Check out the cost of anything that doesn’t add to the bottom line and make sure it is contributing in some way to the business. Even office supplies can be reduced in price once you start looking at various online suppliers.
What About Your Assets?
Does the business have assets it doesn’t use? You might have property you no longer need, equipment you don’t use or even a storage area that can be used in another way. For some businesses that have been around for a long time this is one area that can surprise them.
Often, they discover that an old warehouse on what used to be cheap land is now worth a lot, and what is in the warehouse is hardly worth keeping. Auction the stuff off, lease or sell off the warehouse and increase your cashflow without any real loss to the business.
We Are Having a Sale!
Of course, there is always the old tried and true for moving some of that surplus stock out by having a sale. If you have products that you no longer offer, now is a good time to clear them out and make some money on them as well.
This is the kind of thing you can even offer initially to your favorite customers through a special mailing. Once you have seen if there is any interest, you can then open up the special prices to the general public. Just make sure you have a way to keep track of stock so you don’t find yourself selling what you don’t have in house.
I am sure there are more ideas beyond these, but you can get the picture from this. When money is tight, or you simply need to clear out old stuff, these all can help. As the economy continues to be unpredictable, it is a good idea to have a strong cash flow and more than a little in the old emergency fund.