One of the toughest tasks small business owners must perform is maintaining a stable cash flow. Recent research from Intuit indicates that 61% of businesses encounter cash flow issues globally. In addition, it has been highlighted that poor cash flow management contributes to the failure of 50% of small enterprises in their first five years of operation. So let us understand what cash flow is and how to solve cash flow problems in a small business.

1. 5 WAYS TO IMPROVE
CASH FLOW
MANAGEMENT IN
SMALL BUSINESSES

2. One of the toughest tasks small business owners must perform is maintaining
a stable cash flow. Recent research from Intuit indicates that 61% of businesses
encounter cash flow issues globally. In addition, it has been highlighted that
poor cash flow management contributes to the failure of 50% of small
enterprises in their first five years of operation. So let us understand what cash
flow is and how to solve cash flow problems in a small business.

3. 1. Verify That Your Books Are Updated:
One common bookkeeping mistake made by small business owners is failing to maintain
updated books. Make sure your books are up to date. If you keep your records up to date
on a regular basis, you may use them to monitor the movement of cash through your
company and, if necessary, give a complete picture of its financial status.
If you lack confidence in numbers, hire a qualified public accountant or outsource your
bookkeeping requirements to a third-party organization.
Here are 5 ways to improve your
cash flow management

4. 2. Quick Receivables
Recovery:
Accelerating receivables collection is one of the finest
ways to manage cash flow. The following techniques can
be used to quickly recover your receivables:
Be as honest as you can while making payment
arrangements.
Send out invoices right away.
Give customers who pay on time discounts or other
incentives.
Provide a number of payment alternatives.

5. 3. Optimize Accounts
Payable:
Make paying the bills more straightforward.
Create a relationship of trust with your suppliers so you can talk
to them about payment conditions.
Regularly examine your spending
Automate the buying procedure.
In the past, it was recommended to receive money as soon as
possible and to postpone paying bills out of your own pocket as long
as you could. Deloitte asserts that postponing payments can harm a
business’ connections with its suppliers since they become less
willing to help with problems, respond to questions slowly, and have
stricter payment terms. Delaying payments over time may be
harmful as a result.
Businesses must take the following actions to maximize accounts
payable:

6. 4. Utilize Technology:
Using technology as a tool can help you manage your cash
flow more skillfully. Through the use of technology, all
operations involving cash transactions can be consolidated
into a single system, making it easier to keep track of cash
inflows and outflows. Real-time information will make it simpler
to spot any warning signals and take the necessary action
before issues have a negative impact on the organization.
Since spreadsheets and paper ledgers are no longer
necessary, they will help you overcome cash flow forecasting
challenges.

7. 5. Maintain a Cash Reserve
As a Backup:
In case of unanticipated emergencies, keep a cash
reserve on hand and make arrangements in advance to
meet these costs. If your records are accurate, it will be
simpler to determine your liquid assets and the expenses
you can write off.
Keeping a high credit score makes it easier to obtain
short-term business financing. You can raise your credit
score by using company credit cards to pay for
emergency funds.

8. HOW CAN WE HELP?
Regardless of the size of the company, cash flow is its
lifeblood. IBN Tech is an industry expert well-versed in
cash flow management techniques. Get in touch and
understand how your business can benefit from these
services.

9. Contact Us
Phone : +1-844-644-8440
Sales : sales@ibntech.com
Visit
https://www.ibntech.com/