There’s nothing more important than maintaining the financial health of your business, but in the course of your day-to-day operations it’s easy to overlook. One moment you’re in the black and before you know it enough unexpected costs have come up that you’re not sure you’ll be able to pay your suppliers. There’s nothing easy about managing your business’ cash flow, but if you follow these 5 tips you can successfully stay on top of your finances without having to kiss your business goodbye.
Keep an Eye on the Bottom Line
You should always know exactly how much money you have in your business accounts. Money is the lifeblood of business so it’s nothing to “guesstimate”. Using tools like Quicken or Mint can make tracking your net savings convenient. Having a solid number can also help discourage unnecessary purchases.
Plan Your Purchases
There’s a reason everyone always recommends a budget, and that’s because it works. Calculate how much each of your regular expenses are going to cost every month (rent, utility bills, salaries, etc) and start every new month by putting this money aside. Your business decisions should reflect how much capital you have to spend, and you can’t make the best decisions if you don’t have accurate information. Budgeting away all your regular costs will let you know how much of your money is free for new inventory and equipment.
Make a Rainy Day Fund
It’s a sad thought, but the “rainy days” of yesterday are quickly becoming the hurricanes and tornadoes of today. There’s no telling what sort of emergency your business might have, so it’s important to put aside some of your revenue as a buffer against forces out of your control. It doesn’t have to be a natural disaster — a drop in sales, a rise in material costs, any of these things could spell the end for your business if you haven’t properly prepared.
Don’t Put Off Your Taxes
No one likes thinking about their tax bill and that’s why so many people put off doing their taxes until the last minute. But the longer you have to work on your taxes, the more time you have to find deductions and write-offs that can save you real money. Because the tax code is always changing, every year warrants a brief refresher on new tax credits or deductions so you can be sure you’re maximizing your return.
Merchant Cash Advances Can Cover the Gaps
If you haven’t managed your cash flow properly and have payments to make, you could consider a merchant cash advance. Unlike a traditional bank loan, they have fast approval, don’t appear on your credit history, have no fixed payments and don’t rely on your credit score to qualify. Because they’re based on a percentage of your credit card transactions, they’re popular with seasonal business as well as any business that sees a lot of month-over-month volatility. Click here to find out more.