The Tyro Blog

26 July 2016 - 2 min read

Business Strategies

Big cashflow tips for small business

Cashflow is the lifeblood of your business. Get it wrong and you could become another sad statistic. In the last year, nine out of 10 of all Aussie businesses that went bust were SMEs. And the number one killer? Bad cashflow. Here’s how to get yours right.

1. Make a cashflow forecast

Without cash, you don’t have a business. You will buy stock, pay wages, leases, tax … you may even want to grow. So knowing what you are up for ahead of time is vital. Read more.

2. Make it easy to get paid

Offer to accept all major cards, be clear about your payment terms, and encourage direct debit or automate payments where you can. Read more.

3. Get paid immediately

Are you invoicing on delivery or monthly? The difference could add (or subtract) thousands of dollars to your bottom line each financial year. Why not offer incentives if they pay early? Read more.

4. Keep a lid on finances

Doing the basics right like streamlining your back office, maximising sales, cutting excess spending, having a good handle on your lines of credit can do wonders.

5. Get a better deal from suppliers

Ask these questions: What’s my discount for prompt payment? Can I get credit terms rather than cash or deposit? Can you match your competitor’s best rate? Read more.

6. (Bonus tip) Update your technology

Whether it’s handling staff rosters, your accounting, taking payments or paying bills, there’s some new tech out there to help you. Read more.

Remember, no matter what sector you’re in, good cash management is vital. Not only do you get greater financial flexibility so you can grab a bargain or cover a drop in sales or unexpected costs, you are getting a better understanding of how your business works. And that’s one thing you can’t put a price on.

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