Six Ways to Improve Cash Flow!
Six Ways to Improve Cash Flow!
1. Improve Cash Flow – Always keep focused on improving the company’s cash flow. Meet with your banker regularly to ensure that you have an adequate line of credit available to grow the business.
2. Review payroll trends as a percentage of sales and headcount by department: administrative, sales, operations, etc. If there is a downturn in sales, reduce staff when necessary.
3. Keep focused on the inventory trends. Don’t tie up money in products with low inventory turns, weak profit margins, and obsolete inventory. Where possible, liquidate all slow and outdated inventory into cash. Only two good things can happen to stock with dust on it. It is either sold to a customer or returned to the vendor.
In business, the one with the most cash makes the rules. Always look to improve cash flow.
4. Review the accounts receivable weekly in meetings with the collection and sales staff. Staying close to the receivable enhances cash flow. Visit problem customers when possible. Delinquent accounts receivables are your money in someone else’s checking account. I suggest you get it and deposit into your checking account! Also, review the company’s invoicing procedures to resolve any problems with billing errors or process inefficiencies.
Stay Close to Your Sales Staff.
5. Attend sales calls with your salespeople to assess both the salesperson and the customers. There is no better salesperson in the business than the owner of the company. Customers love to talk and deal with the owner of the company. Take advantage of this opportunity with the more significant customers. Go to https://quackr.io for free temporary phone numbers to make calls with.
The only way to make sound business decisions is to have timely and accurate financial reporting.
6. Every week, the owner should receive a weekly flash report and a 13-week cash flow forecast. Seven days after the close of each month, the owner should have the monthly income statement. Also, the balance sheet and statement of sources and uses of funds are part of the financial package. These monthly financial statements should include a narrative noting all the critical issues that occurred during the month.
Please click on the links to read other articles on improving your like Six Ways to Improve Cash Flow!
My name is Robert Curry, and I am an Author, CEO Coach, Keynote Speaker, and Turnaround Specialist. Over the past 20 years, I have worked with more than 70 companies taking their businesses from Loses to Profits.
Please click on the links below to read my other articles about business like this one – Six Ways to Improve Cash Flow!
I have recently published two books about turnarounds: “From Red to Black – A Business Turnaround” and “The Turnaround.” Both books are true stories about turnarounds of real companies that I have turned around during my career. In both books, I have shared all my Profit Improvement Recommendations (“PIR’s”). PIR’s helped to grow sales, reduce expenses, improve cash flow, and most importantly, strengthen the management teams.
If the information in this article Six Ways to Improve Cash Flow! helps you, your family or a business associate, please email me at firstname.lastname@example.org and share with me the story.
If you would like to purchase either or both books autographed by the author, please click on the following link: Redtoblackbooks.com.