Like most entrepreneurs operating small local businesses, you know how important money is to your organization. At times, maintain a proper cash flow can be a tall order for you. You have to constantly nudge your customers to pay up their dues on time. Otherwise, how on earth are you going to meet your operating expenses. Your suppliers, staff members, and vendors also expect you to pay the amount you owe them promptly. The last thing you want to do is disappoint them and jeopardize your market operations. Even research shows that 60% of the most profitable businesses become bankrupt because of a cash crunch. You certainly don’t want to face such a situation.
Jeff Mohlman – How local business owners can avoid a cash crunch?
The people living in Dayton, Ohio are fortunate to have Jeff Mohlman as their financial consultant. He has valuable years of experience under his belt in this field. Throughout his long career, this expert has been instrumental in improving their financial status. Thanks to him, they are able to accumulate enough wealth to maintain a high standard of living. He also extends his professional services to the young aspiring entrepreneurs in the area. Under his guidance, support, and expertise, they have been able to establish successful businesses. He also owns two of the most profitable investment companies in the area. These are Mohlman Financial and Renovation Investors, LLC.
This expert from Ohio says maintaining a position cashflow is critical to the smooth functioning of any business. This task becomes even more important for entrepreneurs operating the local establishment. After all, they need to ensure that the capital they invest in their organization remains intact. The same thing applies to you. The last thing you want is to face a serious cash crunch situation. This is why he suggests you should keep in mind the following three important tips:
Formulate a cash budget
The first thing you should do is the write up a suitable cash budget. You need to make a comprehensive list of all your incomes and expenses. This can give you are the idea of where money is flowing into and out of your business. The difference between the two can show you whether you have a surplus or deficit. You also get to know the areas where you are overspending and curtail such expenses. Such a task can even open opportunities where you can generate more revenue for your business.
Being open to various modes of payments for customers’ convenience
Going after your customers to ensure they pay their dues is both tiring and frustrating. After making successful sales, you need to make your payment conditions clear to them. You highlight such terms and conditions in the invoices you issue them. You can reward them for prompt payments and penalize them for defaults. You should also open to other payment modes. These could be in the form of internet banking, mobile wallet or plastic money. You even consider hiring the services of reliable factoring agency.
Negotiate better payment terms with your suppliers
You should also negotiate with your suppliers to extend your terms of payment. This gives you enough time to clear your dues with them. You also ask them to offer you attractive discounts for prompt payments.
Jeff Mohlman says above three important tips can help you tide over your cash flow problem. This will go a long way to make it easy for you to run your business. You could even invest the surplus money in securities to earn a lucrative return.