Managing your cashflow effectively is a crucial aspect of ensuring that your Geelong business remains afloat.

Here are some useful cashflow management tips from expert accountants that will help you remain liquid from month to month.

Monitor Your Cash Flow Closely

Maintaining vigilant monitoring of cash flow is the first step towards guaranteeing its health. If you don’t regularly track your income and expenses, they can quickly get out of hand, leaving you with a cash flow crisis.

Various accounting software can help automate the tracking of your income and expenses to ensure your cash flow monitoring is done on a weekly or even daily basis. Such software can also help you spot trends and potential issues before they escalate into much more serious problems.

With the help of an accountant, try to prepare detailed cash flow forecasts to get an idea of your financial position over the next six to twelve months. This can help you plan your cash flow better and avoid surprises.

Tighten Up Credit Control

It is essential to keep a firm grip on credit control, especially during times of economic uncertainty. This means ensuring that your invoices are sent out promptly and that you don’t let late payments slip by without following up on them.

If possible, implement shorter payment terms and try to incentivise your customers to pay early. Consult an experienced accountant to help you establish stricter credit policies that will prevent cash flow gaps and protect you from late payments.

Negotiate with Suppliers

As much as you want to keep your money inflow steady, you also need to control how much goes out and when. To better manage this, try negotiating better payment terms with your suppliers. This generally works better if you are a longstanding customer.

Depending on your supplier, you might be able to negotiate bulk discounts or extend payment deadlines on long-term agreements. If you are able to do this, you can free up some working capital to ensure you have more cash available for any unexpected expenses that may crop up.

Cut Back

During times of economic uncertainty, you need to reassess your business expenses and cut back on non-essentials. Wherever you can reduce or eliminate costs without compromising your operations, you should consider doing so.

Unnecessary expenses could include anything from travel to subscriptions or even reducing your office space. If you can minimise your overheads, you can trim the fat and optimise your expenditure, thereby ensuring better cash flow during tough times.

Infuse Advisors & Accountants have helped many businesses in Geelong and surrounding areas with our expert cashflow management tips and accounting services. If you also want to benefit from our expertise, contact us today.