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Increasing Your Cash Flow

Your company's cash flow is one of the things that you have to stay on top of or you will struggle to survive. When the cash flow gets in the red, your company is in a serious situation. You are not able to have money to pay all of your bills and it is challenging for you to be able to even afford to pay your staff. You must have money in cash reserves in the event that you do have a cash flow problem. There are several different loans and things that you can use that will be able to help to balance your cash flow. Some companies will use invoice factoring to help balance out the cash flow as it allows you to take your invoices and to sell them off for cash today. You also do not need to worry about the collection of your invoices as the factoring company will do all of this for you.

Having money in your account within 48 hours of a sale is huge for the company because you can use this money and put it right back into your cash flow so you do not have any issues with your cash flow. Keeping your cash flow under control is important to your financial health and to preventing you from losing your company.

What can you do about increasing your company's cash flow? Start by managing your company's expenses. You need to get started with these before sales because the expenses are much easier to cut than to try and get people to bring in more money to the company. The expenses you cut can give you immediate money that you can put back into your cash flow right now. What are some of the expenses you can cut? How about starting with your overhead expenses? Manage your inventory better in order to reduce your costs. Stop producing as many products that just sit in a warehouse and start putting more money into your cash flow by keeping an inventory that is made to order. Have just enough stock on hand to get through each month or each quarter instead of having inventory sitting around for a year or longer.

Other expenses you can cut to manage your cash flow are things like electricity costs. Stop turning on every light in the building! Set up lights that only turn on when there is motion in the room so the lights are not on when the room is not in use. You also need to consider installing energy efficient lights as they can also reduce your electrical expenses. Shut off the machinery and other things that you are not using when it is in rest mode. Turn off your computers at night as they can just suck money from the company by eating up electricity that is unnecessary.

Once you reduce as many costs as you can for the company your next goal needs to be to work on generating more sales. Instead of marketing for new customers, start marketing to your existing customers. You need to market to these existing customers as they will be able to provide you with the best income possible. They are already sold on your company and your products and all you have to do is remind them why they need your company.

As sales come in from your existing customers your next goal can then be to start marketing for new customers. Generating new sales will then be able to help your organization as you can attract new people to give you money for your cash flow to stay alive.

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