We’re used to supporting businesses and individuals with all related financial support including accounts, taxation and business advisory, covering everything from agriculture to professional services. As such, here are my top insights on managing cash flow to effectively position your business for a successful 2017.
(1) Managing cash flow with targets
One way of managing cash flow is by preparing and maintaining a cash flow forecast.
If you feel you were ill-prepared this year, the good news is that the best time to do this is January, so with 2017 underway you have a plan you can review at least every six months within the business and sales funnel.
(2) Agree clear payment terms
Establishing clear payment terms from the outset is vital to business success when managing cash flow. This is particularly true in small growing businesses – as the old old saying goes, “cash is king”.
(3) Invoice promptly
A big factor when managing cash flow is when companies invoice. Indeed, SMEs should act quickly and invoice clients as soon as the work is completed, ideally.
If you wait two weeks or even a month after the work has been complete, then this has a huge impact on the business as you may not get paid for 60 or even 90 days.
(4) Use technology when managing cash flow
Technology or effective systems in finance can make it much easier to manage cash flow, even something as simple as an Excel spreadsheet can help you and the business stay on track with the basic information such as expenditure and income.
(5) Source local support and funding
The Autumn Statement 2016 announced some really positive changes that will help small businesses in 2017, including the regional support programme which has awarded £1.8bn to Local Enterprise Partnerships in England.
Some £556m will go to the North of England, £392m to the Midlands, £151m to the East of England, £492m to London and the South East, and £191m to the South West.
The funding is aimed at improving transport connections, unlocking house building, boosting skills, and enhancing digital connectivity. This will particularly help small businesses with growth and innovation.
There are also other funding opportunities from government such as the £400m in venture capital funds through the British Business Bank for growing innovative firms.
The year ahead
January doesn’t have to be a month for tightening belts and taking stock, it can also be set up a year to get organised and kick-start your sales strategy or launch a new product. All you need for success is to ensure you have the right foundations in place for it to happen.