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6 tips to improve cash flow

improve cash flow

How can your business improve clash flow?

From disruptions in the global supply chain to late customer payments, the fallout of a turbulent economy can lead to some serious issues with cash flow.

To help your business manage the uncertainty and improve cash flow, we’re here to offer some best practices on balancing your outgoings and strengthening your position.

1. Get your bills in a row

It’s hard to maintain accurate cash flow when you aren’t completely clear on how much money your business needs each month to pay recurring bills. By using a monthly budgeting tool, your business can start to plan and save money from high-revenue months to cover the overheads in the months you’re running short. A forecasting tool will also reveal any potential problems well ahead of time.

2. Improve and automate your invoicing

It’s simple. The faster you get your invoices out, the faster your business gets paid, and the healthier your cash flow is. By investing in accounting software, you not only ensure a seamless invoicing process, but avoid the potential errors that can often come with a manual based way of working. Not only that, but your business is also able to access a clear and real-time dashboard of all your current and previous transactions.

3. Increase your pricing

It might sound obvious, but it’s important to take a step back and determine whether or not your prices are reflective of the time and cost behind their production. By spending a little time auditing your different products and services, you can confidently decide whether your pricing is actually hurting your bottom line. If you’re feeling reluctant, a good place to start is with products that have less competition in the market.

4. Plan ahead

With credit control software, you have a set of solution options that can contact and update your clients before delays become issues. This could even trigger negotiations and rearrangements in advance, allowing your business to plan for problems ahead of time. Staying at the mercy of unforeseen events is no way to operate long term. Make sure your credit control software can make proactive interventions before missed deadlines become a problem.

5. Stay connected to customers

Make sure that your accounting software isn’t an isolated aspect of your business management solution. Full integration with your customer relationship management allows invoicing, credit control and more to become a natural extension of your normal business operations. Working far more intelligently and responsively to different and specific situations.

6. Get clear on your inventory

Did you know an inefficient inventory can lead to increasing costs by up to 25%? When dealing with high levels of stock, it’s important you’re keeping tabs on how much inventory you have, what’s due to come in, and what’s due to go out. Without a clear sense of what’s happening in your inventory, it’s almost impossible to maintain a healthy and balanced cash flow.

With the support of the right technology, companies can find the most effective ways to take full ownership of the processes making a direct impact on improving your cash flow.

To discover more ways to improve costs in other areas of your business, explore our latest guide on protecting profits & controlling costs for 2023.