Cash is King!
We are now well into 2017, and although the economy continues to progress positively, the Brexit situation has brought a new set of uncertainties, and in the Eurozone the Greek situation has raised its head again, all of which shows that the future is never always certain.
It’s therefore worth recalling the old adage that profits are all very well, but it’s cash that matters to the health and survival of businesses. Every little really does help.
So, here are 10 tips for maximising cash resources during these difficult times.
1. Reduce Costs. The opportunity for cutting costs is almost always greater than you think, and even a small reduction can make a big difference.
2. Squeeze Working Capital. Good housekeeping is always important. Don’t be reluctant to chase invoices, and take advantage of early settlement discounts where possible.
3. Check Pricing. Especially for a premium product or service. It’s amazing how often pricing is overlooked, with an innate belief that it must always go down.
4. Keep your Customers. It’s almost always more expensive to get new customers than to keep your existing ones. Old customers are already bought in to your service, maximise them.
5. Buy Well. Constantly review suppliers and prices, like costs a small amount can make a big difference.
6. Keep up with the Market. When your focus is almost totally on business survival, its easy to forget to watch industry developments, and how they can affect you.
7. Check out the Competition. Understand what they’re doing and how it affects you, ensure you are not left behind, watch for new ideas that you can replicate.
8. Review your own Products / Services. Do they need a full revamp, are there any gaps in your offering, or opportunities for new business?
9. Plan Well. Always keep the big picture in mind, whilst managing day-to-day trading. Ensure you work on the business as well as in it.
10. Finally, reduce the Tax Take. So often businesses don’t know of or don’t take advantage of all allowances. Take good professional advice.
Finally, remember, its “profit for show, and cash for dough”! Good housekeeping also starts with being selective in what business you take on, always avoid buying business just for volume, it’s about achieving at least a decent margin.
24 February 2017