KMA Goldmine TV E25KMA Goldmine TV – Episode 25 – Cashflow

“KMA GOLDMINE TV EPISODE 25 – Cashflow “

 

 

Here, Kim Marlor talks about the important points around Cashflow and how to improve it

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Hi, it’s Kim here with KMA Goldmine TV, another episode for you to help you take your business from where it is now to where you want it to be. 

This week, I thought I would talk to you about cashflow and some of the things that you can do just to help yourself. We’ve all been in the situation where we’ve had a cashflow issue and we’ve needed to do something to pull in a bit of extra cash.  Whether it’s to pay a bill just to go on a holiday, whatever, it doesn’t matter, but we’ve all been there. So what can you do to make sure that cash flows easier into your business? Well, to make it flow easier, you could think about setting precise terms and conditions so that easily enforceable and I’d recommend that you invest in getting a solicitor to draw those up for you so that if you did ever need to rely on them in court, you could do.

Second way you could help is to make sure you know your customer. So credit, check them. You know these days we’ve got to do lots of checks on customers anyway for money laundering purposes. So why not to do a check? You know there’s people out there, Equifax, Dun and Bradstreet where you can run checks on potential customers to make sure of their credit worthiness. Because let’s be honest, what’s the point of working for a client or customer and then not getting paid? Never a good idea. So you want to make sure that they are in a position to pay you. And then also it’s a good idea if during your working relationship you continue to check on them. You can set up alerts for example, which we’ll tell you if something changes and there’s a change in pattern and there might not actually pay you so that you can then call a Holt to doing any more work so you’re not at risk.

Finally, I’d recommend that you map out your process for debt collection so you know what you’re going to do if somebody doesn’t pay you to your terms. So, for example, if your terms are 30 days on the 31st day when they haven’t paid you, you can then kick in that debt processing. So it might be a combination of phone calls, emails, letters, and then finally, obviously if the relationship’s broken down completely on, they’re still not paying you. Then obviously the legal side of things, hopefully you won’t get that far. There’s also other things that you can do to help and that would be, for example, taking the risk out by taking deposits or may be stage or milestone payments. Very common in the construction industry where at a certain milestone when you have delivered a certain amount of work, you could then raise an invoice for that amount so that you never risk to the whole job or product or service. So hopefully that’s got you thinking about what you can do to get the cash flowing in your business. And De-risk slightly from a perspective of credit control. So, until next week, that’s came from KMA Accountancy Goldmine TV, helping you to take your business from where it is now to where you want it to be.

Bye for now.

If we can help with anything included in this edition or if you’d like to talk to us about anything Accountancy or Business development, then call us now on 0161 410 0016. 

 

 

 

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Cheshire WA15 9NZ

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