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  • Writer's pictureDEROTTO Leasing


1. Lease or finance equipment instead of draining your capital reserves.

One of the most common cash flow mistakes is using cash to buy a major long-term asset, instead of getting financing. Even if you feel flush right now, you may suddenly wind up short of cash if you experience a sudden revenue shortfall or rapid growth.

2. Monitor your cash flow regularly.

Many software programs such as QuickBooks, Simply Accountant, MS Excel, etc. make it simple to reconcile your accounts, generate reports, and more. It is so important to manage incoming revenue and outgoing expenses. It may make sense to hire an accounting service to help you stay on top of your cash flow.

3. Determine your breakeven point.

You should know at what point your business will become profitable because it gives you an early goal to strive for and a ready-made target for projecting future cash flow. Focus your efforts on managing your cash flow to reach that moment when you realize your first profit.

4. Increase your sales.

Consider an advertising campaign to increase sales and grow your customer base. Marketing your business doesn’t necessarily require a lot of money. For example, using digital marketing channels, like social media, can be a cost-effective way to advertise and promote your products or service.

5. Cut costs.

Focus on recurring monthly, quarterly or annual expenses. Can you cut back on utilities, rent or payroll? Are you spending money on subscriptions or services you’re not using or insurance you no longer need? Can you renegotiate the terms of outstanding loans or leases?

6. Liquidate assets you don’t need.

Do you have equipment you no longer use or inventory that’s becoming obsolete? Consider selling it to generate quick cash.

7. Get a business line of credit before you need one.

A business line of credit is a good insurance policy against future cash flow problems.

8. Get business credit cards to cushion your cash flow.

Look for cards with rewards such as points you can use toward travel or business purchases. In addition to providing a cushion for lean times, business credit cards also categorize your purchases, so it’s easier to track expenses.

9. Stay on top of accounts receivables.

Receivables are the primary source of incoming cash for many companies and must therefore be well managed. Consider offering your customers incentives, such as a percentage off the total, for early payments. Do the math beforehand to ensure the tradeoff (getting paid early) is worth the loss (less money in the long run).

10. Stay on top of accounts payables.

Figure out the happy medium between how late you can pay your suppliers, vendors and other creditors without risking late fees or harming your relationship. This keeps the cash in your account as long as possible.

11. Maintain some cash reserves.

It is a rare business that doesn’t, at some point, experience a cash shortfall. Make it a priority to put aside money regularly as an insurance policy against an inevitable cash shortfall. Maneuvering cash shortfalls is one of the keys to maintaining a successful business.

12. Ask for deposits or partial payments on large orders or long-term contracts.

For example, a building contractor or website developer might charge a 10 percent deposit upfront before beginning to draw up plans for the project, then charge half the remaining amount when work begins, and the balance upon completion. Charging this way, the company generates enough cash to finance the materials and pay the workers needed for the job.


Click the button below to fill out the working capital application form.

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