Managing Your Cash Flow in 2019 Checklist
Trying to manage a business without managing cash flow is like trying to sell a pen to a stationery company. With the first month of 2019 already behind us, businesses need to get on top of a cash flow plan for 2019. We’ve compiled a checklist below to help you get ahead.
1. Chase overdue invoices – Do it now. The longer you leave overdue invoices, the more it will impact cash flow. Send an overdue notice or a payment request email. If this doesn't work, follow-up with a phone call or consider charging a late payment fee on your invoices.
2. Invoice quickly – Consider using digital tools like Xero to streamline invoices and ensure you send out as soon as possible to avoid hurting cash flow.
3. Avoid focusing too heavily on profit – Concentrating too heavily on profit and break-even points means you’ll lose focus on cash flow and spending. Ensure you set aside some time to check up on your personal and business finances every week.
4. Understand your working capital needs and have access to finance – Take time to develop a relationship with your bank manager. A growing business sucks cash, so if you are growing quickly you’ll likely need to borrow.
5. Set aside backup cash – Aim to always have backup cash, even if the business is going well. If you hit some unexpected finances, your business will survive.
6. Reward staff – Set sales targets and reward staff that achieve these goals. But make sure you create a healthy, supporting environment for your staff who are happy to work for you (this is just as important as managing cash flow).
7. Have a good accountant who understands your business – We can help with that! We not only help plan and forecast cash flow we can also help you take advantage of new opportunities and grow your business into its full potential. Contact us now!