Cashflow is the lifeblood of every small business. That makes cashflow management a key determining factor in whether a SME sinks or swims. Essentially cashflow is the movement of funds in and out of your business. So cashflow management is about ensuring that you have a firm handle on your business finances at all times while having enough funds set aside to pay debtors and attend to unexpected costs should these arise. Here are top ways to achieve strong cashflow management in your SME.
Projections power up cashflow management
Conduct a cashflow projection for your SME. There are several online tools available to help you out with this otherwise just a basic spreadsheet will suffice. Map out your cash inflows and cash outflows. Do these marry up? Are you left with shortfalls anywhere? If your cash inflows and outflows are out of alignment, go to work renegotiating payment dates and chasing late debtors. This simple but proactive cashflow management tip will help keep your business finances fit, healthy and agile.
Be an on-time payer, not an early payer
Yes that feeling of paying a bill as soon as it comes it and knowing it’s squared off can be very satisfying. Not only are your creditors happy but you can get on with business without worrying about bills slipping through the cracks. But what does being an early payer mean for your business cashflow? Most creditors provide 30-60 day payment terms so if you pay early, you lose the use of that sum of cash which could otherwise be kept in your business. Pay your bills on the date they are due but not before. This allows you to keep full use of that cash in your business for the payment period which means you:

• Earn interest
• Have cash available if unforeseen costs arise
• Support other key areas of your SME
• Keeps cashflow management clear and tidy

Bridge shortages with smartly tailored finance
Good cashflow management will alert you to any aspects of your SME where you need to invest extra funds. But what happens when you don’t have those funds free to invest? Look to a flexible small business loan like those offered by Capify. With fast turnaround, minimal paperwork and upfront daily repayment schedules, Capify small business loans translate effortlessly to sound cashflow management. In fact, these loans support sound cashflow management. Speak to Capify today.

Or call 1300 760 930 to speak with one of our friendly Lending Consultants now.