Being in business can be frustrating. You seem to be making good sales, you seem to have the right margins and you seem to be growing but you are broke and the business is in danger of imploding. Equally, your business may be going through a little bit of a lull and you are short of cash. 5 tips on improving your cashflow…
1. Do an immediate stock take and identify any stock that simply is not selling. It is important to turn this back to cash as quickly as possible, even if you have to sell at cost or below. Buy in product that will sell and use the money to repeat the process. People tend to hold on to underperforming stock as if they were emotionally attached. Cut the cord and realise the cash…
2. Do a price review – there may be some items where you can achieve a higher margin – Higher margin means more cash available to run the business. many people are afraid of this tactic but just because you buy well, should not mean that all the benefit is passed on.
3. Brief analysis of costs – some cost items tend to fluctuate in price or are negotiable – do a quick calculation on where costs can be saved. Recently we did this with a client whose monthly costs were 32000. Within 20 minutes we had identified savings of 2500, without touching wages or impacting on customer service. This can be the difference between profit and loss, survival or failure.
4. Settlement deals. Some suppliers may be prepared to do settlement deal if you can get the money together. Discounts can be achieved if you ask. They may need the cash injection as well so approach them. You have nothing to lose.
5. Review your opening hours – it may be that business is passing you by or it may be that you are opening when there is no business to be had. Again, small savings or small increases can be achieved – worth a quick review.
6. Most importantly – train your team on sales – so many businesses are leaving business behind because they do not help the customer when they enter the business. There are many strategies that can be taught in this area. start today.
for more cash strategies and quick wins in you business, cal me on 087 222 0720