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Cash flow is one of the primary concerns occupying the minds of business owners across the world on a daily basis. When trade is sluggish or inconsistent, every decision you make becomes more difficult, and your days become more stressful. When it’s flowing well, by contrast, you’re free to focus on growth and seize opportunities to improve quality, efficiency, productivity and marketing.
If you’re ready to leave cash flow dramas behind, the following five tips will help you reach a new level of profitability:
1. Business finance
You may be surprised to learn that there are numerous avenues you can leverage to obtain finance with exceptionally favourable terms. From asset finance to invoice discounting, you’re bound to find an option that suits your business size and structure. Research the options available in your region, and be sure to do your due diligence before going ahead with an offer.
2. Join (or form) a buying co-op
By connecting with other similar-sized businesses in your area, you can team up to purchase supplies you all need together. This greatly improves your bargaining position, allowing you to negotiate for lower prices from common suppliers. By joining or forming a co-op, you create an opportunity to access the discounts large corporations have well before you reach that size. If you’re at a loss as to where to start, consider joining a small business mentoring program to find like-minded business owners in your area.
3. Nurture your relationship with clients and suppliers
Some business owners choose to do this with gifts or gourmet hampers. However, you can nurture relationships with your key customers and suppliers by simply being a good communicator and considerate person.
You may already be offering discounts to clients for early invoice payment, but have you considered offering early payment to your suppliers in exchange for discounts? If you’ve established a strong, friendly relationship with them, such requests have a better chance of being approved.
4. Up your prices
Of course, you don’t want to hike your prices up beyond what’s reasonable. However, many business owners fail to account for year-by-year inflation, keeping their prices the same and thus robbing themselves of the profit margin they deserve.
Customers aren’t as vehemently opposed to price increases as you may think. The key is to communicate clearly and persuasively and to be honest with them about the reasons behind your price adjustment.
5. Give your marketing strategy a makeover
If you’re experiencing cash flow issues, now may not be the time to invest in the development of new products. However, you can boost your income by overhauling the way you present your current offerings to customers.
Are you taking advantage of social media? Do you have a talented marketing guru handling your email marketing campaigns? Has your website been reviewed and adjusted by an on-site optimization expert? There are many ways to improve your marketing strategy, and by delegating these tasks to the right employees or freelancers, you could open yourself up to a cavalcade of new customers.
Cash flow difficulties are among the most stressful challenges you’ll face as a business owner. However, this makes it all the more satisfying when you finally get all your processes in order and establish smooth-flowing profits and steady growth. Your mind is your most powerful tool for success. So, start with the strategies outlined above, but never stop educating yourself on business finance and cash flow strategies.
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