10 Tips for improving your Cashflow.
As the owner of a small business you know how important it is to stay on top of your invoices and ensure that you get paid on time.
Some business owners are SO busy that they forget to raise invoices and end up not chasing overdue invoices. This is a huge ‘NO NO’ and should be a No 1 priority for your business. You should know on a daily basis what is coming in and what is going out of your bank account to ensure your liquidity.
So, what can you do despite being busy to make this a No 1 priority;
- Raise Invoices that you are aware of at the beginning of the month, even the predicted ones so that you have an idea on what money is coming into the business. They can be in draft form and not issued but if you use a software accounting package, this will allow you to visually see cash projections.
- Postdate the Invoices so that they are ready to send, and this saves time at the end of the month.
- As work is completed add items to the invoice so you don’t forget what work you are owed money for. This is easy if you use time tracking software as you can add in additional lines on the invoice for additional work requested or additional time taken for a task that you can bill.
- Raise predicted expenses / bills that are anticipated so that reports of cashflow are up to date.
- Make sure that you send the Invoices on time and on a regular date so that your client knows to expect the Invoice.
- Make sure that if the Invoice total varies from what has been agreed or expected that you tell your client during the month, this is then agreed so that they are not met with a surprise when the Invoice arrives and contest the payment.
- Make sure that your invoice has been completed with all information required and especially has clear payment terms and bank details.
- Send follow up reminders when an Invoice is overdue and if you use software there are various tools to help you with this.
- Make sure that you monitor your bank account on a regular basis, checking daily and reconciling and matching your payments in your bank or accounting software etc. This saves so much time at the end of a month / quarter and you are also on top of your cashflow and ensuring it is up to date.
- Use a receipt/invoice capture tool to make sure that you are not scrabbling around for receipts and invoices to match off payments. It is so easy to snap an image of a receipt straight away before you lose it and also to forward any invoices that are emailed to you straight to your account. Also, with integration to Accounting software the receipts and invoices are uploaded to your cashflow ready to be matched off and job done
There is something quite soothing about being on top of your cashflow and with technology and software these days, most of the hard work is done for you so there is no excuse to be in the dark about your cashflow.
Here are a few apps / software that I know of or that I use to help my life easier with my cashflow;
Time Tracking Software
If you are struggling to keep up to date with issuing invoices or chasing payment, then please do not hesitate to contact me as I would be happy to discuss and help you plan and implement a strategy to ensure you are on top of your cashflow as your support partner, second brain and business manager.
A lifeboat in a crisis and a lighthouse showing you the way, on your administration journey !