7 cashflow tips for stress free finance in 2010

A new year is a time for reviewing what’s worked well and what needs to be changed for the year ahead. Here are seven rules for cash flow success in 2010.

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8th January 2010 at 6:27 pm

1. Prepare cashflow projections at least two quarters in advance. An accurate cash flow projection can alert you to trouble well before it strikes.

2. The key to managing cash shortfalls is to become aware of the problem as early and as accurately as possible. Financial services providers are wary of borrowers who have to have money today. They’d much prefer lending to you before you need it, preferably months before.

3. Cashflow problems can often be self-inflicted. Companies which send out incorrect invoices often find that their customers end up returning an invoice and requesting a new one. Make sure all your invoices are correct before they’re sent out to ensure your customers have no excuse for not paying.

4. You may be able to raise cash by selling and leasing back assets such as machinery, equipment and even office furniture. However, you could lose your assets if you miss lease payments.

5. Make sure you have a robust process for chasing up your invoices.

6. Know your customers! Some of your customers will pay on time every time – others will be perennial late payers. The more information you have, the easier your payment collection process will be.

7. Consider using an invoice finance provider. These are financial services businesses that can pay you today for invoices you may not otherwise be able to collect on for weeks or months.

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Tracy Ewen

Tracy Ewen is managing director of IGF Group, an independently managed commercial finance company specialising in the small and medium-sized business market, particularly companies from new start up to £10 million turnover per annum. http://www.igfgroup.com/

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