Cash Flow Management for Small Businesses

Cash flow management became a big concern for many businesses this year, especially after COVID set in. The problem was that most companies didn't have a good handle on their cash flow, but their accounting system was not set up to make cash flow management possible.

Cash flow management is a method of analyzing and managing the amount of money moving in and out of your firm over a set period. You should be able to spot both cash flow shortfalls and surpluses if you do it correctly. If you can have a grasp on your cash flow, you'll feel a lot less stressed and be able to plan and implement business strategies much faster.

Develop an accounting system that supports cash flow management

Developing a solid bookkeeping system that allows you to control cash flow is the first step in cash flow management. Contact us for the best tax filing service in Tulsa, OK.

So, precisely what does that imply?

Automatic payments or accounts receivable

To begin, you must create a system to manage the incoming flow of funds into your company. The most common blunder made by businesses is having too many payment options. You can purchase on their website using an external processor and pay by cheque or cash. All of this leads to systemic confusion and inconsistency.

Have you ever purchased something online and then received a message saying, "Please get in touch with us to let us know how and when you would like to pay"? No, not. But instead, please enter your credit card information, and here are the forms of payment we accept. Pay special attention to payment options that reduce accounts receivable days, increase cash flow, and fully automate your accounting system.

In an ideal world, all of your customers would pay promptly and automatically using a credit card. You can then control when they pay and receive immediate confirmation that the payment is authorized. Clients frequently express dissatisfaction with merchant fees, claiming that they cannot pay them and prefer to wait for checks. When you accept checks, the difficulty is that you can't effectively regulate your cash flow. If you receive bills, consider how much time you spend stressing over your open accounts receivable report, customer follow-up, bank deposits, and bounced checks.

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