Keeping the Cash Flowing: Money Management Essentials for Business Owners
By Business Desk
Thursday, August 3, 2017.
When most people set up a business they have one thing on their mind: profit. Of course, profit is the ideal outcome of any business venture, but to keep the profits rolling in, you need to ensure that you keep cash flowing through your company at all times. By this, we mean that you have to invest in your business for it to expand and progress. Remember, as a business owner, you need to bear in mind that patience is a virtue. It can be tempting to draw out all of your profits for personal use, but if you put those profits back into your brand, you’ll benefit more in the long run. It is recommended that you keep between ten and twenty percent of your monthly profits aside to reinvest in your company. Here are a few money management tips to ensure that your business has the means to truly flourish.
Cash Flow Finance
We are all familiar with the frustration of waiting for payments to clear. You’re waiting for the money to finally make its way to you so that you can put it to good use. An effective cash flow finance agency can help you in this situation. These facilities allow you to access money that’s tied up in your sales within a speedy twenty-four hours, instead of waiting up to ninety days for payments to fully process. It’s simple. All you need to do is send the agency a copy of the invoice, they will pay you 90% of the amount and then transfer you the final 10% once the client has fully reimbursed them. You can then make use of the cash without having to waste time waiting around.
Encourage Customer Loyalty
When you’re working in commerce, repeat buyers supply the holy grail for your company’s cash flow, expansion and growth. Generally, you begin to truly make a profit from an individual on the third or fourth time that they return to your business. By this point, they have usually developed a sense of brand loyalty and will have a confidence in your products and service that will see them purchasing more products and making bigger investments. There are multiple ways to encourage this loyalty. First: reward schemes. You can offer discounts or a free item for every so many numbers of purchases that a customer makes. For example, one free product with your tenth order. Once the customer has made a few orders, they will become more likely to shop with you even if your prices are higher than competitors, as they will have their eyes on the prize of the free product at the end of the tunnel.
So remember that for your business to excel, it’s absolutely essential that you keep the cash flowing through the company and that you reinvest the money to improve your products and service. This will help you to make larger and more consistent profits in the long run, which is the ultimate aim of the business game.
