If your business is getting squeezed by tight cash flow, you must take immediate action to correct that situation. Collecting the money you are owed — faster — is one sure way to improve your bottom line. Here are three things you can do right now that should help your cash flow improve.
- If you bill for work after it’s been completed, don’t be an invoice laggard. Get that invoice out the door as soon as the work is completed. No need to wait thirty days to bill. Do it now and you’ll have your payment in hand sooner.
- Get a merchant account or set your business up with PayPal so you can accept credit cards. This will cost you a few bucks, but you’ll have your money in days rather than weeks. Then all you’ll have to say to your customers is, “May I put that on your credit card?”
- Consider setting up your billing on an incremental basis. There are no rules that say you must do the work and then get paid. When you negotiate a contract, set it up so you receive a portion of the payment when you begin, another portion when you are half done and the rest when the project is complete. Setting payment milestones will go a long way in keeping the cash flowing.
Small Business Expert Denise O’Berry is the author of “Small Business Cash Flow: Strategies for Making Your Business a Financial Success” a book about how to get, manage and keep your cash flow on an even keel and where it belongs — in your business. She provides small business tools, tips and advice to small business owners around the world on her blog at http://www.deniseoberry.com. Find Denise on twitter at @deniseoberry.
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