Business Finances Management — Tips & Tricks

July 25th, 2019

There are several tactics when it comes to managing cash flows, and those businesses that are doing it successfully have these things in common:

  1. Create a business plan — this helps you put your thoughts on paper and through the process of writing them down, you’ll also be able to prioritize which projects you want to execute first. i.e. those with the highest return on investment. When writing down the projects you want to execute on, it’s also important to clearly define what success means … what are the KPIs next month, or next quarter? Clearly having goals and their KPIs in mind helps you define what resources are required to get there. It could be either through organic cash flows or when you get business financing. Communicating your goals and KPIs to your lender helps them propose the right financing solution for you.
  2. Have cash on hand in case of emergencies or when things don’t go as planned. According to Daniel Kehrer, founder & managing director of BizBest Media Corp. “While the sun is still shining on your business or before your financial picture has a chance to turn sour, meet with lenders and/or landlords proactively to see if there are opportunities to restructure debt, payment terms, etc. Having cash on hand is critical for staying afloat and continuing to grow.”
  3. Know where your team is weak and prepare a hiring plan accordingly. If you want to be a business owner and not a business operator, you’re going to have to delegate and build a team of individuals who are specialized and can do things better than you in those areas where you’re weak. If selling is not your forte, find an experienced individual who can help you tests and iterate on different sales strategies and ultimately close on opportunities. Administrative tasks should be outsourced or delegated to someone else — your time is too valuable.
  4. Know your business finances and cash flow. You need to understand your business finances and where your cash flow is coming in and going out. That will allow you to forecast when things might get tough and start talking to lenders in advance. Anticipation is the ultimate power. Yes, you can hire an accountant but it is ultimately your business. Understanding where the new business opportunities lie, what the revenue pipeline looks like, how many deals were closed this quarter, what the operating costs are month-to-month, your capital expenditures and if there are any seasonal fluctuations you can prepare for, are you able to cover expenses and pay your vendors in winter times, etc?

Most financially strong companies have gone and adopted those best practices above. We strongly recommend you do the same and feel free to reach out to if you’d like to talk to one of our client success team members to help!

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