Managing Cash Flow For Your Business

Managing cash flow in your business can be very difficult. It is dependent on your type of business, how your customers pay and even the economy. Cash flow can become the single most important thing in your small business. Although money can’t fix every problem, it sure does help to be financially fit with a healthy bank account.

Keep Your Accounting Up To Date – Managing Cash Flow

It is impossible to know what is coming out of your bank account if your records are not up to date. It is helpful if you use accounting software such as QuickBooks. Entering all of your expenses and keeping track of checks, payments and sales that come in are important. Writing checks or swiping your debit card when you don’t know how much money is really there, is scary. In down times (which every business will have, even if it is temporary or seasonal), it may be important for you to update your accounting every single day.

Do You Have A Tool? – Managing Cash Flow

What we mean by this is a specific “way to track what is coming in and what is going out” at any given point in the month. This may be your accounting software, but it may also be a cash flow worksheet that you come up with yourself. Knowing what expenses need to be paid out through the month and having them written down in chronological order can be helpful. This would be ideal in a situation when you are trying to decide whether to make a big purchase. Do you have enough? Pull out (or open up in Excel) your handy list and see what else is coming out this month.

Make Income A Priority – Managing Cash Flow

This is highly dependent on your type of business, however we can all agree that cash (income) is King. There are few challenges that can’t be overcome by raising your top line. Or in another scenario, do your customers owe you money? Only in a perfect world does everyone pay on time or early. Are you managing your past due invoices? Do you have a system for this? If not, you need to come up with one and you need to have policies that protect you. In the case of a store or restaurant, this may mean insuring your daily deposits make it to the bank.

As your small business accountant, we will be your partner. We are here to serve you in all areas of your financial health. We have the experience to guide you through any of your ups and downs. We have been helping small businesses manage their cash flow with up to date accounting for nearly 30 years.