Follow the Leaders
The foundation of smart business management is maintaining liquidity. This is particularly true during times of uncertainty in the financial market. You want to have a reliable source for funds should you want, or need, to be prepared for changing opportunities.
If you run a small business and find yourself dealing with restricted cash flow on a regular basis, it’s time to review some basic steps to get things moving again.
As soon as the job’s complete, send the bill. Consider asking for upfront deposits or partial payments if your business undertakes long, complicated and/or expensive projects.
Make it clear when payments are due and offer a small discount for quick payments. For example, 2 percent off if paid within 14 days.
Don’t pay your own bills sooner than required. Check when bills are due and schedule payments accordingly to keep your cash on hand for as long as possible.
Don’t risk taking on clients who have a long history of making late payments (or not making payments at all). Be proactive in conducting credit checks so you can feel confident your clients will pay you in a timely fashion.
It costs money to store products that aren’t selling – and it can also cost you to not have the products readily available that your customers want. Analyze inventory and purchase trends regularly so you can meet demand (without undue surplus).
Obviously, you probably don’t want to partner with direct competitors. But if you can find similar companies who use some of the same supplies as you (but ultimately sell different products), consider asking them to make combined purchases from suppliers. That way, you’ll both benefit from bulk pricing.
Chris Layne, market president for the Richmond Metro region at Blue Ridge Bank, is a commercial banker with over 17 years of banking experience. His primary clientele includes closely-held businesses and non-profit organizations. If you have any questions for Chris. please feel free to reach out to him at 804-518-2625 or email@example.com.. If you have any questions for Chris. please feel free to reach out to him at 804-518-2625 or firstname.lastname@example.org.
Blue Ridge Bank is a community bank with a national reach. Blue Ridge Bank is all about business. Our team exudes an enterprising spirit in each local market so we can best serve our business clients. We provide a wide range of financial services including retail and commercial banking, wealth management, insurance, and government-guaranteed lending.