Cash flow is an integral part of every business, so cash flow challenges are incredibly common. They’re also serious: Around 82 percent of businesses that fail do so because of issues with their cash flow.
So you’re probably seeking solutions to one of the most basic challenges in business. If you’re experiencing any of the following five cash flow issues, try some of these solutions.
One of the biggest issues for any business owner is keeping the books. Whether you have a part-time bookkeeper, work with a team of accountants, or do the books yourself, the right processes are essential to good record-keeping.
Unfortunately, many businesses don’t keep good records. Disorganized books could lead to a state of confusion and present cash flow challenges. If your books don’t reflect accurate amounts because of errors or omissions, how can you have an accurate picture of cash in your business?
Cash management devices such as smart safes can help. These machines will improve your record-keeping, make it easier to reconcile the books, and give you a better real-time picture of cash in your business.
Business overheads are another common cash flow challenge, and they affect most businesses. In an age when expenses just seem to keep going up, you may wonder if there’s anything you can do.
Streamlining your operations to improve efficiency is perhaps the best thing you can do. Adopting an automated solution such as a coin and banknote recycler could lower your labor costs by helping your team count and sort cash in no time. Preparing deposits and floats is much easier with the right equipment.
You may also be able to reduce cash-in-transit or bank fees with these solutions. Lower expenses mean you have more cash where your business needs it most.
Cash flow challenges often stem from not having a good view of the cash moving in and out of your business. If you’re not sure how much cash you have on hand, you might not make the right choices about deposits or the store float. In turn, you may find you deposit too much cash, leaving you short when you need it.
This could add to other issues, particularly with your working capital. If you’re unsure how much cash you require in the store float or how much you have on hand, you’re probably not deploying your funds to maximum effectiveness. You may experience cash shortages, leaving you without enough cash on site to make change or, more seriously, putting you in the red when you need to make a major purchase.
Again, cash handling devices will help you get a better picture of cash in your business so you can make the right decisions. With these solutions, you can free up your working capital to invest in what your business needs.
One of the most common challenges when it comes to cash flow is inaccurate projections. You may expect to have a certain amount of cash coming in but forget to allow for a purchase that you need to make or bill you need to pay. And of course, an unexpectedly slow sales day could throw your predictions off.
Accurate forecasting relies on a good body of historical data. Cash management devices help you keep better records, but they also assist you in collecting the data you need to make those predictions.
If you’re constantly scrambling to pay the bills, it can be difficult to think of anything else. A business owner must focus less on day-to-day cash flow issues and more on profitability.
Again, a better view of the cash picture in your business can help you find new solutions. If you’re ready to focus on cash flow improvements, get in touch with the experts today.