It’s all too easy to think that if your business is bringing in sales, it must also be earning cash.
Sadly this is often not the case.
There are bills and taxes to pay, and you may find your customers don’t always pay you when they should – and this can easily lead to your business running out of money.
In fact, poor cash flow management is one of the biggest reasons why small businesses don’t survive. So it’s important that you don’t keep making mistakes when it comes to managing your business’s money.
Here are five top tips to try if you find your cash flow has dried up.
1. Consider contacting your suppliers
If you think you’ll need more time to pay a supplier, don’t wait until they chase you for payment. Depending on your relationship with them, you might wish to contact them now, by phone if possible, and negotiate extra time to pay.
Approaching your suppliers before they approach you could potentially cause less damage to the relationships you have with them than if they had to chase you.
Be careful though, because if your suppliers think you are a poor payment risk they might tighten their credit terms or refuse to deal with you in the future. Judge your suppliers carefully before you make the call.
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