Cash-flow problems arise
often when clients get behind on fee payments. The best way to avoid this problem
is to get paid up front or have a more enforceable agreement about when fees will
be paid.
Good quality control is
important so that clients can be sure they are getting the service for which payment
is due. Cash may be king, however, finding options is queen
It may be time to consider
increasing prices to maintain a consistent revenue stream. Or, it may be a good
idea to start trimming operating costs as well.
Look into ways to lower
the cost of fulfillment by automating business systems. Avoid wasted labor expenses for things that can be
automated. Create check lists and protocols to provide staff or substitute workers
with written or automated documentations, macros and automatic responders to save
time and money.
Don’t reinvent the wheel for every new vendor or hire. Provide a video orientation for them. Provide self-serve and frequently asked questions on the company website. Also add phone systems that will keep hiring to a minimum. (For example: “Press 2 for hours and directions to our location.”)
Don’t reinvent the wheel for every new vendor or hire. Provide a video orientation for them. Provide self-serve and frequently asked questions on the company website. Also add phone systems that will keep hiring to a minimum. (For example: “Press 2 for hours and directions to our location.”)
Here’s another idea that
might help cut spending: Perhaps a business can use a barter system or receive in-kind
services in lieu of a fee or partial fee.
It’s a good idea for businesses
to keep close watch on their cash-flow shortage as opposed to operating losses.
While some small businesses
use credit card companies, it may be a better idea to get a line of credit from
your existing bank before a cash-flow crisis occurs. Your bank usually will listen
to your needs at no extra cost instead of sending bill like an attorney or accountant.
Businesses should project their spending, plan
and budget accordingly. Watch for recurring expenses. Prune clients. Businesses
should ask themselves, “Are we just spending or investing?”
In the long term, strategic planning will pay off.
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