One of the biggest challenges businesses are facing is being able to understand and maintain a healthy cash flow. This is becoming even more of a challenge with interest rates and inflation continuing to rise.

Uncertainty through these challenging times brings an extra amount of stress on businesses. That means it is crucial that businesses do all they can to stay on top of their cashflow, whilst implementing a range of factors to not only improve your cash flow but benefit your business as a whole.

Below are six tips that have been put together to help your business improve its cash flow for challenging times.

Adjust your business plan

It is a good idea to adjust your business plan on a regular basis to ensure efficiency. When putting together your plan ask yourself if you are trading profitably, if you have put enough cash aside to meet your regular financial commitments, and is your business ahead of its goal or behind.

Once you have answered the above you will be able to clearly state what you want your business to achieve and measure it accordingly. This can be really helpful during challenging times as you will be able to evaluate the success of your business and keep all information up to date.

Forecast your cashflow

Ensure you are using cash flow forecasting, this can give you a great insight into your future cash flow. You will be able to predict which months you will see a deficit and which months you might find yourself with a surplus, enabling you to forward plan better.

Cut costs

It is a good idea to do an audit of all your businesses expenses. This will allow you to determine areas within the business where you can save money as well as give you the opportunity to see if there are things you are paying for that your business no longer use or require. By selling those assets you will increase cash in the business, whilst saving on costs.

Equipment Finance

You may find your business is able to release some cash through your equipment or motor vehicles. If your business needs to use expensive equipment to operate, you may find you are better to lease it or purchase it via finance instead of paying cash upfront.

Improve your online presence

When forming your website, you need to make sure you are enticing your customers to return. Many businesses think they need to spend lots on marketing however, this doesn’t need to be the case. Marketing covers a range of areas within your business, that is why it is important to take into consideration all aspects that could affect how your customers identify your business and make changes accordingly.

Capital Raising

Raising capital through your business assets could help solve cash flow issues both short and long-term whilst providing taxation benefits.

For example, you might require capital raising for any of the following:

• To assist with the purchase of unique and specialised goods
• A simplistic way to restructure a partnership or company position
• To provide taxation benefits as well as generate cash flow for the business
• To redistribute cash flow from previous business purchases
• To provide cash flow/liquidity during unpredictable/seasonal/cyclical periods
• To assist with unforeseen expenses such as mechanical repairs, unexpected creditors, legal fees, and tax payments

Having a healthy cash flow leads to success within your business. That is why it is important that your business ensures they revisit their forecast on a regular basis and identify areas you can improve, so when your business faces a challenging period, you will be prepared.

Contact us today on 1300 4 MORRIS and speak to one of our finance specialists to see how we can help your business manage its cashflow through these challenging times.