Cash flow management is a big deal, there’s no getting around that. As business owners, we know it’s something we can’t ignore and have to face head on, which can be extremely stressful when you’re just starting out or dealing with it on top of everything else in a small, local business. Yet there’s ways around this: if you like to delegate and also have the ability to bring someone else on board to cope with it for you, you’re going to be ahead of the game in the finance world. Here’s some tips on making sure your small business doesn’t revolve around the numbers unless you’re specifically working in the finance field.
Know the Basic Terms
If you’re in business, even at beginner level, you’re going to understand quite a few things. However, with your expenditure, you need to be sure of items like:
Burn Rate: operating at a loss
Break-even: operating with zero profit
Fume Date: when you run out of cash
Don’t Think of Debts as the Be-All-End-All
Yes, debts are going to have a massive windfall on your business standing, and yes they can feel like an absolute disaster, but they don’t have to be the end. There’s plenty of ways to cope with an outstanding or incoming debt, and they don’t all involve selling up and being made to move on.
First of all, you’ll probably need an accountant to go over the books for you (there’s more on this option below) and make sure you know about all the options available to you. You can also convince a lender you owe to compile debts into one and pay it off a month at a time, which is significantly easier than keeping track and paying for them all at once.
Outsource When You Need To
So yes, outsourcing can become expensive, but sometimes it’s the better option than bringing in a new hire when you know you don’t need them long term and could damage your business rates if you tried to keep them on. If you’re dealing with books you have no idea how to balance or a debt you know you can’t handle on your own or within your firm, be sure to outsource. There’s no harm in it, and it doesn’t have to become a habit if you decide to bring in a favored person for a more full time position.
Look into a credit recruitment agency for people specialised to work with credit control, as you’ll usually have more luck with these places than striking out on your own. Similarly, if you’ve successfully come out the otherside of something, you can also use these services to hire yourself out, as if you’re skilled enough to have the necessary knowhow, you’ll be in high demand for other businesses.
When you know what you can and can’t do with your cash flow after a while of being in business, you’re going to be better equipped to handle any problems that come your way.