Cashflow management

Do You Have a 'Cash-Flow Conundrum'? If Yes, Remind Yourself That Cash Is King (and Queen).

Cashflow management can be a tricky challenge to master. And consequently, if managed poorly, can...read more

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Cashflow management

8 Steps to Avoid Cash Flow Problems at Your Small Business

Is your business experiencing cash flow problems? Here is an expert 8-step process to solving that...read more

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Added via Small Business Trends
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Questions

How do you cut costs in your business?

Without knowing more about your business, this is almost impossible to answer specifically. However, a couple of generic things to look at:What are your fixed verse variable costs? Fixed costs are the costs you incur everyday, regardless of how many goods you sell (i.e. an office lease). variable costs are cost you only incur when you produce or sell a good (i.e shipping, production costs, product insurance etc). All things being equal, a higher proportion of variable costs can be beneficial as you only incur the costs when you are selling goods and generating revenue. So think how you can switch your costs from fixed to variable. obviously the trick is then to reduce these variable costsDepending on your type of business, how much inventory to you have? yes you need to to meet your customer needs, but having excess inventory is a huge business cost! try and minimise your inventory holdings, while still meeting your customer needs Are you getting the best deal from suppliers? what is the relationship between your accounts payable and your accounts receivable? Are there lower cost suppliers or can you get better contract termsHave a good look at your key financial ratios. these will tell you where to look in your business to help reduce costs. How do these compare with similar companies in your industry (if you can find this out?)If this is a real issue for you, i would suggest you talk to someone who can help with this, as you will need to get a handle on this. While there are many companies who work in this space (yes we are one of them) make sure you get someone who can not only help you in the short term, but also teach you what to look for moving forward so you can continue to monitor your business as apposed to someone just trying to sell you something. We also offer free initial consultations if you would like to discuss more.
All the costs in my business are required.I hope I don't ever try to cut costs and look more into increasing the costs of my services instead.
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Who uses debt Collection agencies? Who do you use and are they small business friendly?

Steven Freeman
Steven FreemanOwner at Evolved Sound
Have used a few but only in extreme situations when we have exercised all efforts and the situation has blown out. By then they have a hard case, so it is difficult to know whether its them or the case which is making their service questionable.
Hi Danielle, try the CollectMore app. It's free and the person who created it, Paul Metcalf, is very helpful. I'd email him for advice if the app doesn't work for you. Good luck!
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Questions

Just wondering what are the requirements of paying tax to be able to claim small business expenses?

And is it worth it or is it better to run it as a hobby? I'm approaching my 1st year and also... read more

George Grimekis CPA
George Grimekis CPAAccountant at Alpha Omega Accounting & Business Solutions
Hi Jeanette,It seems from your wording that you are already running a business. A hobby is a spare time activity pursued for pleasure or recreation whilst a business is run with the intention of making a profit.Indicators of a business include but is not limited to:- Having an ABN/Business Name- you are keeping records- you genuinely believe you you will make a profit even if you do not do so- repeating nature of transactionsIn saying that, if what you are doing is a hobby then the $3000 you have spent is not deductible. If you are running a business and you have not made any turnover, then you will need to pass the non commercial losses tests before the losses can be deducted against your income.Any losses made that do no pass any of the tests in the non commercial losses rules will have to be rolled over until such time the tests are passed and you can claim them in future years.If you need further clarification please send me a private message or you can google "non commercial losses"and click on the A.T.O link.
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Questions

When paying my company’s bills, should I take advantage of early payment discounts or pay late?

Hitesh Mohanlal
Hitesh MohanlalDirector at WOW! Advisors & Business Accountants
Good question. Yes if you have the funds it is worth taking the discount because on an annual basis the discount can save you money. I once did a calculation for one of my clients which showed that it was worth him increasing his overdraft and take the discount. Paying late can also work but this generally affects goodwill. If you pay on time and then find you are in a tricky position, suppliers will give you a bit more time to pay. If you are constantly late it can affect your relationship. You need to do some quick calculations but i usually take advantage of early payment arrangement.
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Questions

Are you a shoebox culprit on your finances?

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Questions

How important was cash flow to Vinomofo?

How important was cash flow and did it ever take a back seat when you were growing your company? read more

Asked by:
Wendy Huang
Wendy Huang Full Time Blogger and YouTuber at A Custom Blog in 4 Minutes
Neil HallsOwner at Clear Path Commercial Consulting
Simple Answer, Cahsflow is King. We have come across many business were Cashflow problems have caused profitable businesses to get into difficulty. Almost always, that difficulty can be avoidedWe have a blog on our website which talks about this exact topic in more detail
Justin DryOwner at Vinomofo
Incredibly. We started Vinomofo with $100k in the bank so we didn’t have much wiggle room. It was so important to us that we would actually update it daily. This way we knew exactly where we were going to be (based on projections) at any time over the next 3 months.We also kept the business very lean to give ourselves the longest runway possible. Obviously the numbers are bigger now but we still manage cash flow and stock levels very closely.
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Cashflow management

Dealing With an Unexpected Financial Blow to Your Business

Remember that unexpected repair or a client didn't pay you on time? Or you lost that big account...read more

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Added via The Huffington Post
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