Improve your cash flow with QuickBooks accounting solutions
One of the tell-tale signs that a business is healthy is a constant flow of cash into and out of the company. While it is always good to have money coming into the business, the money going out is almost as important, and if spent correctly, it can help your business to grow – even in a slow economy.
Improving cash flow is easier than you might think. QuickBooks accounting software provides small to medium business owners with the tools necessary to monitor their income and expenses and improve cash flow. Discover the ways in which QuickBooks accounting solutions can be used to improve cash flow and grow your business.
4 ways to improve cash flow for small to medium businesses
- Tighten inventoryWhile inventory is necessary for sales, an excess of products can tie up your cash unnecessarily. Products are only financially valuable once they are sold and provide you with an income. If your warehouse is overstocked, you will have spent money on products that will not be sold until a later date. This money could be better used to pay other expenses such as salaries, consumables and rates and electricity bills.By implementing QuickBooks accounting software solutions, you can monitor the speed at which your products are being sold and stock your inventory accordingly. Keeping your warehouse stocked with the optimum number of products will free up cash and improve cash flow.
- Invoice early and oftenJust as unsold stock ties up your cash, so do unpaid customer accounts. By billing your customers early, you can increase the speed at which they pay you the money that they owe, thereby making that money available to be used by your business. Invoice your customers as soon as they make their purchase and send them a reminder at the end of the month. Often, customers pay their accounts late simply because they forget. Moreover, if you are expecting the economy or your industry to go through a rough patch, you could benefit from encouraging your customers to pay their accounts by offering discounts for early payment.QuickBooks financial software can help you to monitor how much your customers owe and invoice your clients at regular intervals.
- Stretch out accountsWhile you may want your customers to pay as soon as possible, you should hold off on paying your accounts until they are actually due. By doing so, you can earn interest on your money until the account is officially due and this money can be used for urgent expenses such as rent. However, it is important that you do not incur any penalties or cause friction with your suppliers by postponing payment.QuickBooks accounting software can help you pay your accounts on time every month, taking the hassle out of your hands.
- Don’t expand until you have sufficient capitalMany business owners believe that they can improve cash flow by expanding their business. However, the most common result of premature expansion is incurring additional expenses. Be sure that you have sufficient capital to expand before purchasing new equipment or renting out additional office space. Use QuickBooks accounting systems to assess your capital and predicted expenses before you expand you business.
Want to improve cash flow? Choose QuickBooks
The first step towards improving cash flow is to get an overview of your business’s current financial status. With QuickBooks financial systems, you can find out how much capital your business has, what accounts must still be paid and who currently owes you money.
Peruse our selection of financial software solutions, including accounting software and payroll software, to find the right programs to help you improve your business’s cash flow.