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Q: What are your top tips for improving cash flow?

Oct 10 2007

Answered by: Mark Endersby Ask a question

Cash is the lifeblood of any business and it is imperative that cash flow is monitored and forecasts are produced. If banks and financial institutions can see that you keep a close eye on your cash and predict shortfalls in advance they are more likely to assist.

Good house keeping is essential and credit control is an important part of any business. If you are offering credit terms to clients you should get paid on time? Negotiating terms with your suppliers is also advisable as it helps to build relationships with them.

If you are selling to other businesses then a good way to improve cash flow is via an invoice finance facility. There are two basic types of facility. Factoring is where a lender will provide you with up to 90 per cent of the invoices you raise but will also chase the outstanding debts on your behalf. This is an excellent outsourcing opportunity for small businesses. Confidential invoice discounting is another alternative. With this you merely receive an advance against invoices and there is no involvement or disclosure to your clients.

SmallBusiness.co.uk have produced a variety of guides & tips to help small businesses manage their cash flow.

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SmallBusiness.co.uk looks at how factoring and invoice discounting can help with cash flow.

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Take command of your cash flow by ensuring you don't fall victim to late payment.

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