3 Ways of Proper Financial Management for Better Business Cash Flow

If you are into a business you need to think about this deeply. To make a business survive one need to put consistent flow of cash into the business. A good financial planning helps to maintain a good cash flow for a business. Here are some points that I have discussed on good financial planning for proper cash flow into the businesses. 

Make a proper budget:

Effectively prepare a budget for your business. Combine the actual, estimate and historical figures to ascertain the exact value for the budget. Make a list of all the expenses that took place in previous year, eliminate those which are not going to take place this year. Add cost of all promotions, campaigns that are going to take place in this year. Do not forget about the tax requirements of this year. Compute your tax from an expert tax agent in NZ to save extra bucks. Now calculate the revenue that you are going to incur during this year from the existing projects.

Review the terms of trade: 

Before commencing the business, the owner must decide the terms of trade. You may have terms of trade for 7 days, 14 days or 30 days. This is the time which you give to the buyers to pay the bills. It must be clearly mentioned on the invoice. Make your terms of trading written in simple language to avoid any confusion.  You need to mention it in the invoice 7 days after getting the product or 7 days after getting the invoice. Eliminate these kinds of petty confusions so that you have a clear idea of the time of getting your money. 

Check debtors’ accounts and impose good debtor control system:

Do you have regular late payers and payment dodgers? This system can harm your business a lot. Hence you need to apply a good debtor controlling system. Consult with a professional financial planner to imply some strategy to counter this. You can use automated reminder system on a periodic time for the clients. You or your assistant can send gentle reminder e-mails or mails to the clients asking to pay off some of their money now and rest can be paid later on.