It’s that time of year where everyone is thinking about CASH FLOW, right?
Increasing cash flow in your business can sometimes feel near impossible, but it really isn’t! Don’t believe me? Here are 4 very easy ways to instantly increase YOUR cash flow RIGHT NOW!
1) CUT – CUT – GROW:
To increase your cash flow do an in-depth analysis of your day to day as well as your monthly expenses in your company. This includes everything from documents you and your staff print out, to coffee and tea that is consumed. Once you have a comprehensive list of exactly how much you are spending on what, look for areas where you can cut costs. For instance, if you are currently buying the most expensive brand of coffee, and your staff consumes a whole tin of coffee in one week, look at purchasing an alternative brand that costs less. The same goes for certain services you may be paying for. For instance, if you are currently paying X for your email hosting services, get alternative quotes to find a service provider that can provide you with this service at lower rates than your current service provider. When you start adding up your savings in the areas where you’ve cut, you will see that you have created an additional amount of cash flow that is now available every month, and this adds up to increase your cash flow over the next 6 – 12 months as well, giving you much needed cash flow to further grow your business.
2) TRADE YOUR WAY TO SUCCESS
Have a look at some of the services you are paying for and the relationships that you have with those suppliers. Are any of your suppliers also start up businesses? Do any of these suppliers need the type of services you have to offer? Or do you perhaps need a specific service to grow your business but cannot afford it at the moment? Find a supplier that offers the service that you need, but who also needs the kind of services that you offer, and do a trade exchange with them.
Trade exchanges are as good as paying money for a service, but services are being traded instead of money. Be sure to secure any trade exchange with a written agreement stating what each party agrees to give to each other in services every month, and put a monetary value to it so you are clear on the value of each of the services being traded. Also ensure that you put a timeline to the trade exchange stating the start date and end date or review date of the agreement to trade services.
I’ve assisted many of my clients and students in building and growing very successful businesses with no capital, just trade exchanges, and built my very first business with trade exchanges as well. Who can you think of that you can do a trade exchange with right now?
3) UNLEASH YOUR NEGOTIATING SKILLS AND LEVERAGE YOUR RELATIONSHIP CAPITAL
Have a look at your existing suppliers and make a list of suppliers that render services you need to grow your business, and negotiate better payment terms with them. For example, if you are currently paying cash on delivery, negotiate to run a 30 or even 60 day account with them. This way, you have that cash flow available to grow your business for an additional 30 – 60 days from receiving your goods or services from your supplier. This ties in with the next point, so read on….
4) INCENTIVISE YOUR EXISTING CUSTOMERS
Have a look at your current payment terms that you offer to your clients. Are they paying in installments? Are they paying a deposit upfront? Are they paying in full upfront? Incentivise your clients to pay in full upfront by offering them a discounted rate for doing so. This will most definitely assist in cash flow in your business, right? For example, if you offer a monthly service at R1000 per month, incentivise clients to pay 6 months to a year’s installments in advance to receive a 20% discount on the total amount for that period.
5) BONUS TIP
Incentivise your existing customers to send referrals to you. You can offer them a commission share if the referral becomes a client, or a discount on the services you deliver to them per for example 5 referrals that they send to you, who become customers of yours.
If you action the above key steps to increasing your cash flow NOW, you can start the new year off with the cash flow that you need to grow your business and get the results that you want even faster.
Here’s to your success!