The Halloween season is upon us. With ghouls and goblins lurking around every corner, it’s not uncommon for folks to get a little frightened this time of year. As most small business owners would attest, running out of cash is one of the scariest things imaginable—particularly if cash flow problems catch you off guard. Without access to cash, it becomes impossible to meet your existing obligations, and you can forget about taking on new ones.
The good news is that by planning ahead, investing in new equipment and technology, utilizing a cash flow lending service, and trying to grow your customer base, you may be able to sidestep money problems altogether—sparing yourself additional apprehension this Halloween.
One of the major reasons small businesses run into cash flow problems is because managers don’t spend enough time forecasting their finances—primarily due to the fact that they’re pulled in a million different directions each day. By planning ahead and forecasting your cash flow at regular intervals (e.g., once a quarter), you drastically reduce the chances you’ll be blindsided by unforeseen money shortages.
Invest in new technology and equipment
Does your small business make use of the latest tools and technologies? If your employees are forced to rely on outdated technology to do their jobs, they won’t be able to reach their full potential—it’s as simple as that. To increase productivity—and therefore pad your bottom line—make strategic investments in cloud technologies, mobile devices, and collaboration platforms. Your employees will be able to get work done wherever they happen to be.
Use a cash flow financial solution
It’s not uncommon for small businesses to wait around for 30, 60, 90 or even more days for their customers to pay their bills. While it’s true that a fattened receivables account in your financial statements looks nice on paper, you can’t exactly pay your bills, invest in new tools, or take advantage of exciting opportunities when you don’t have any cash. If you have a stack of unpaid invoices piling up, you can use an invoice financing service like Fundbox to advance their value and unlock cash flow. For a small fee, Fundbox deposits the advance in your bank account within one or two business days. You then have 12 weeks or 24 weeks, depending on the schedule you choose, to repay the advance plus the fee.
Target new customers
When’s the last time your small business reached out to a new customer segment in the market? When’s the last time you made a serious effort to expand your client base? Assuming you can handle the volume, one of the easiest ways to sidestep cash flow problems is to generate more profit. One way to do that is to incentivize your clients to refer new customers your way in exchange for payment discounts on future products or services. If it makes sense for your business, you can also offer free consultations in hopes you’ll convince new clients to sign up for your services.