After your corporate doors are open and your employees are busy producing your goods and delivering services you should take time to analyse your finances. At this point in the development of your business you can find problem areas that can impact your cashflow as well as the competitiveness of your company. Remember to keep an open mind so that you can readily find and implement solutions that are needed for the health of your company. Let’s look at some of the areas that you should examine as you perform a financial analysis of your company.
What Impacts Your Cashflow?
Your cashflow can be impacted by a number of factors that can get out of control if proper procedures are not in place to handle situations that can arise. Determine if your customers are receiving and paying their invoices in a timely manner. Do you or your staff follow-up with communications when payments are not made? How do you collect money that is owed to your business? Do you have a Plan B to implement when your cashflow becomes impacted negatively? Visit the website ultimatefinance.co.uk so that you can begin to craft an alternative plan for having enough cash to pay your bills when they are due.
Revamping your invoices and changing the procedures that you use can be the perfect solution to your cashflow problems. It’s important to train your staff so that they can make modifications in their schedules and complete the invoices on the new timetable. Once clients begin to receive their bills the same time each month, they can set up payment regimes that help you to keep adequate funds available to honour your own financial obligations. Adjust any billing cycles that you find are in need of changes, inform clients of your new process, and ask for their help in making this transition to a new and smoother billing procedure for everyone.
After you have examined your company’s finances, you may want to implement some new initiatives that can prevent any future cashflow problems. Try setting aside an amount of money each month in a special account designed for emergencies and challenging issues. Even if you only begin with a small amount, the money will begin to grow and provide you with a cushion of protection should something happen that you don’t expect. Ask employees to use cost-saving habits around the office and work area so that your energy bills can begin to decrease; staff members can take simple steps to turn off lights in rooms not used or to unplug electronic devices at the end of the day.
Taking a good, hard look at your company’s finances can be the beginning of a more positive cashflow which will keep you competitive in the marketplace. Keep an open mind, implement changes, and train staff members on the new procedures immediately. Finally, having an alternative plan in place for additional cash when you need it will provide you with peace of mind in every challenge.