We all know getting your cashflow right can be like walking on a tight rope. Here the Boss has 5 tips to getting yours on track.
“There are five steps that you really need to be doing to improve your cash flow so step number one is your, profitably now if you don’t have a profitable business obviously you’re going to struggling with your cash flow.
You’re not going to be able to pay your super, you’re not going to be able to pay your P.A.Y.G and your certainly going to be struggling to pull money out for yourself, so if you have a profitable business and you’re having cash flow issues they can be fixed, but the step one is you need to have profitable business, so you need to have your numbers up to date each month and know that you’re making a profit so that’s step one, now step two is you need to be invoicing everyday so make sure that every single day someone is doing your invoicing don’t leave it till the end of the month don’t leave it till the end of the week don’t do it on a Friday, every single day make sure someone in your business is doing the invoices because every single day that your business doesn’t invoice that’s an extra day later that you get paid, and all of a sudden if you don’t invoice for two weeks, that’s an extra two weeks before you’re going to money in the bank.
So you’re going to be covering your wages, you’re going to be covering your stock, you’re going to be covering everything else in your business that you need to pay for while your invoices are sitting there not done, so invoice everyday that’s number 2 ok so profitability, invoicing daily alright number three is your stock and your whip control so you need to make sure that when your jobs are happening, their getting done, so don’t start a job at the start of the month and then take 30 days to finish it, get a job done and get it done as quick as possible and get it invoiced. So that to make sure your orders stock, the stock comes in before you start the job don’t go and spend a whole heap of time on the job then order parts in because every single day that that jobs sitting there unfinished, you’ve spend time on it but you’re not getting paid for that time, so you need to get your stock and whip control under control and make sure that your ordering and that your invoicing for that stock and inside the same month don’t order one month then invoice the next month if you can help it.
Number four is your debtor control system so if you are currently invoicing daily, you do have a profitable business and you are making sure that your jobs are getting completed in a timely manner but you still have cash flow problems it’s because your debtors, it’s because your debtors is out of control, people aren’t paying you on time, so you need to make sure you have a proper debtors control process for collections of your invoices now unfortunately the human race, if we don’t , when it comes to money if we don’t need to pay it people don’t want to pay it and if you’re not following up it is just the case that people aren’t going to pay your bill on time, so what you need to be doing is putting together a debtor process which might mean your office girl contacts a person the day before the invoice is due making sure there right to pay the payment tomorrow, and if they can’t pay the payment, finding out the next payment date and then if that happens and if that doesn’t happen from there you need to be able to escalate It have a set process in place to control your debtors and make sure your collecting your money on time ok so and number 5 is your creditors so time and time again I’ve seen people not getting paid but then they pay their creditors before they are even due so make sure you’re paying your creditors inside of terms cause that’s going to help you hold onto your money for longer and make cash flow problems someone else’s issue so there the 5 things guys to fix your cash flow is number one make sure you got a profitable business number two involve daily number three make sure that you stock and you whip is under control and making sure you start a job and finish your job in a timely manner the quickest you can ok number four is your debtor process making sure you got a set process and system on collecting your money and number five paying your creditors and paying them as far out as you possibly can so alright guys if you still need help with your cash flow and you still don’t know where to turn message the page let us know more than happy to give you a hand and let’s get business moving thanks guys.”