It has been reiterated again and again the importance of keeping an eye on your financials especially during a time like this where things are uncertain. Analyzing your business’ cash flow should be one of your main focus while going through this pandemic in order to implement the best decisions that could benefit you in the long run.
Here are three cash flow elements you need to keep an eye on as we go through this pandemic:
Due to the current situation, some customers may be unable to pay you immediately. While this is understandable, you need to consider that your business also needs the cash inflows to keep it afloat. With this in mind, create a strategy in which you and your customers can meet halfway to clear out these receivables. One strategy to consider is you can offer them some payment plans. Also, you must regularly give them reminders about their payments.
Analyze your purchases in detail. Make sure that you are focusing only on purchasing essentials to keep your business running. You should hold off any major purchases as of the moment. Keep in mind that things are still uncertain, your focus should be on keeping your business steady and afloat. Go back at it one step at a time until things become more stable again.
Review your current fixed costs and see what among them can be reduced or eliminated as of the moment. One fixed cost that you can try to reduce or eliminate is your rent and utility expenses. You can also try to negotiate to reduce insurance fees. The key here is to only keep those expenses that are crucial to keeping your business running.
If you need help with your business’ cash flow, FAS is here to assist you! You can reach us by emailing firstname.lastname@example.org or at 713-899-8035.