Advertisement feature for businesses.Some small businesses across the UK are looking ahead to 2015 with a sense of optimism when it comes to driving growth. The American Express Small Business Barometer found that just under half of the small businesses questioned have been experiencing business growth since the start of the year and 73 per cent are forecasting growth in the coming six months. This compares to 40 per cent in July 2013 and 56 per cent in November that same year*. According to this research, small businesses surveyed are now more focused on identifying the potential of their unmanaged business spending, and increasing their purchasing power. Cashflow optimisation has a major role to play in freeing up funds that could be reinvested in the business, which is critical to achieving growth.
CashflowManaging cashflow is a continuous struggle for many SMEs who must balance the money coming into the business with the funds leaving it. Considering the fact that small businesses in the UK are owed a total of £39.4bn** it’s clear that this juggling act is likely to be an ongoing challenge. Every business has regular and everyday overheads; according to the Barometer*, the average spend on outgoings like travel, stock, supplier payments and equipment is around £12,000 per year for each small firm in the UK. But small businesses need to note that factoring in this spend as part of their financial planning, such as paying for items using cash, cheques or cards that do not offer benefits such as extended payment terms, can still put a temporary squeeze on cashflow. By using cards to pay for these day to day expenses, it will give them the flexibility that comes with being able to pay suppliers but not part with the funds until their statement balance is due. This frees up cash to invest in the business or to plug a temporary gap.
Making expense management easierThe payment systems available with cards are invaluable when it comes to giving a bird’s-eye view of company expenditure. This not only enables more accurate business forecasting, but it also identifies key areas where cash can be freed up, which can then be used to reinvest in the business to create growth. Using an American Express Business Charge Card may mean small business owners have better control of their financial situation. They can check their balance, statements, available credit, and see all of their purchases, 24 hours a day. It could also save valuable time inputting expense data and help keep a close eye on employee expenses, helping ensure there are no big surprises at the end of the month.
American Express Business Charge Cards in practiceWith an American Express Business Charge Card rewards are earned for virtually every pound spent. You can redeem your points for rewards including a statement credit to put towards future purchases for your business like fuel, entertaining clients and new equipment. There are also many other business benefits:
- Using a business charge card helps to keep business and personal finances separate;
- It enables better management of cashflow and frees up cash for business growth, as extended payment terms are available (with American Express that’s up to 54 calendar days);
- It enables supplier payments to be made upfront, meaning better relationships can be built; and
- Upfront payment also means stronger terms can be negotiated as early payment discounts can be secured.
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