Creating awareness around financial saving is important for businesses, and cash flow management is critical for survival.
Many businesses are still travelling the road to financial recovery, with strict lockdowns continuing to be proverbial potholes that hinder progress.
As the third wave of the pandemic continues to crest across several provinces in the country, businesses need to be vigilant in ensuring adequate cash-flow reserves are available, particularly as we head into the latter half of 2021.
The following pointers are considered essential for businesses to consider to ensure continued cash flow throughout the year.
Growing cash reserves
All businesses should plan to build up cash reserves. For many, this practice has been their saving grace, ensuring business continuity in the face of lockdown measures over the past year.
Businesses need to commit to doing all they can to save money each month, and those that make use of accounting solutions can make the process of finance and expenditure monitoring that much easier, thanks to third-party add-ons.
Scaling down expenses
Many businesses have successfully adopted the practice of remote working, which means they are well-positioned to review the need for large and expensive office space. With some businesses still recuperating from the troubles of 2020, expenses need to be monitored and, where possible, trimmed.
Invoicing early and reduce late payments
A thorough invoicing strategy should be in place to reduce instances of having to chase customers for payments, and businesses should instil a sense of being direct and fair with customers.
Plan accordingly by contacting late payers well in advance, invoicing them early and reminding them to pay on time.
Using accounting services
Businesses that are not confident in their financial aptitude should consider investing in reputable accounting software, which will offer them peace of mind, as well as the ability to forecast cash flow for future opportunities.
Software solutions can simplify the accounting process, and provide customers with the tools and resources they need to stay ahead of the competition.
While the majority of industries have experienced hardships in recent times, instilling cash-flow management measures such as these will allow for greater financial freedom in the coming years.