Of course you want your business to have more cash flow. Without cash, your business will simply not succeed at survival in such a tough economy. Just because technology has gotten more complicated and a number of services are now free, the need for revenue when running a small business has not changed. Increasing the amount of cash your business takes in leaves room for growth in a number of ways, from office building size to number of employees. Here are a few ways you can boost cash flow in your small business.
Hold Your Large Amounts of Cash Longer
Many companies only pay their employees once a month, including government agencies, large businesses, and even school districts. Even if they have the money at an earlier date, they don’t pay their employees that money until the first of the month. This is because when you hold a sum of cash for a long time, it earns interest at the bank. That interest is pure profit, and it results from just holding off on the bills until the first.
Make Your Services Worth a Price Hike
People pay for quality! This means if you can find a way to make your services more desirable that you’ll be able to step up your price a little to justify the quality of your product. For example, not everyone likes Hershey’s because of the amount of sugar. Instead, many choose a different chocolate, such as Ghirardelli’s because of the flavors and quality, even though Ghirardelli’s costs double and sometimes triple that of a Hershey’s chocolate bar. People don’t mind paying a premium as long as they believe it’s worth it.
Offer Discounts if People Pay Upfront
People love deals, coupons, and sales. Instead of encouraging people to use credit to pay you, see if giving them a discount will entice them to pay you immediately instead. This means you have more cash on hand that can gather that interest mentioned in point one. Also reward those who pay their bills on time (don’t make them pay extra fees, for example). You’ll get the cash, and the customer will get a reward, too. There’s nothing to lose.