Launching a new business venture presents an exciting yet uncertain time, as even in a strong economy, you will most likely face uncertainty, financial difficulties and instability in this period that can make or break a company. Here is some advice to help keep your head above water and quickly increase your business’s cash flow.
Get a Business Account
Rather than leaving your company’s cash in a current account, open a business savings account that offers a healthy interest rate. Initially, opt for an account that functions in a way that will allow the addition or withdrawal of funds when required, as opposed to a bond or ISA that will hold company finances for a specified term. These accounts will typically require a minimum deposit amount so it is important to do your research. Compare account options online or alternatively, arrange an appointment with your bank.
Use Invoice Financing
In layman’s terms, invoice financing is where a third party purchases unpaid invoices. The company will require a fee, but in return they will pay a percentage of the invoice amount upfront and then pay the remainder when it has been collected from the customer. Specialist finance companies such as Touch Financial also offer a free consultation and can help get your business moving.
Schedule a Weekly Analysis
This may seem obvious, but take the time to scrupulously analyse the accounts every week. Review outgoing as well as incoming finances including the purchasing of supplies, or any outstanding invoices. Closely monitoring cash flow will also highlight your company’s high and low peak cycles, allowing you to more accurately plan and predict your business’s financial future, from key periods where you can make investment, to low periods that may require strategic borrowing.
Hire an Accountant
Although this can be an extra expense, paying for an accountant’s skill set can actually prove to be a worthwhile investment that will ultimately pay for itself. A company such as Just Accountant can find you an accountant, free of charge, who will identify any cash flow problems, offer advice on potential financial issues and possible tax breaks, as well as provide revenue projections.
Invest in your Business
While it is important to take steps to increase cash flow and ensure your finances are stable, remember to reinvest in your business. Actively taking measures to build your business, whether this is in the form of training, equipment, or marketing, can help to ensure its longevity and increase cash flow.