Operating a successful business is all about the two pillars, protecting your bottom line and implementing effective growth strategies. In this article, we take a closer look at strategies for the first pillar, which means financing options that can protect your cash flow and bottom line.   

Cash Flow Management 

A business might look strong on paper, but the day-to-day reality can be quite different, especially if it’s a small business with cash flow issues. In fact, this is one of the main reasons that small businesses fail in the first year – they don’t have effective cash follow strategy. 

If you want to manage and protect the cash flow of your small business, you need to do two things; first, you need to plan ahead, and all of the expected expenditures need to be accounted for and covered. The second thing is to source a number of credit lines to support cash flow. 

Planned Purchases 

Businesses of all sizes require infrastructure to operate; even smaller businesses need to invest significant sums of cash in machines, technology, and industrial spaces. These items come under the umbrella of planned purchases and need to be accounted for in the planning process. 

Planned purchases can be paid for with lines of credit, credit cards, loans, and other business finance arrangements. Planned purchases also need to be outlined in the business plan and taken off the end-of-year taxes as an expense. Again, this helps to stay in control of finances.  

Outstanding Bills 

Another downfall – especially for small businesses and new businesses – is outstanding bills from clients and customers. When a business doesn’t receive payment for services provided, it can impact the cash flow of the business and put pressure on the infrastructure and finances. 

If you want to secure your business and protect its future, you need to have a strategy in place to follow up on outstanding bills. This might look like a dedicated team making friendly phone calls, but it could also be a service you outsource to an agency to ensure you receive the payments. 

On-pay Solutions 

While outsourcing your payment follow-up process is a sensible option at certain times, it’s not the first strategy you should consider. The reason is customer service and support; you want your customers and clients to feel as if you are on their side and not working against them. 

One way you can achieve this is with an efficient payment processing strategy. Automated invoices, like the ones offered by OnPay Solutions are an excellent way to encourage your clients to pay promptly. These automatically generated invoices are fast and effective.   

Growth Investments 

There are two pillars to every successful business, security, and growth. If you can secure your bottom line and put an effective growth strategy in place, you have the making of solid future outcomes. If protecting your cash flow is part of the first pillar, then growth investments are part of the second. Don’t forget to formulate a growth investment business strategy in the initial plan.