Changing market conditions will have a direct impact on businesses of any size, but particularly on smaller businesses with fewer liquid assets and on businesses in sectors facing challenges - such as manufacturing and retail. Regardless of the industry you're in, good cash flow management lies at the heart of running a successful commercial enterprise. In a period of low consumer spending and high business failure, focusing on the following fundamentals will help your business survive in the long run.
- Forecast cash flow on a monthly or weekly basis to help you identify periods of low revenue and/or high expenes
- Structure balance sheets in a detailed manner, including inventory, debts and interest costs
- Collect accounts receivables on time to avoid unnecessary stress towards the end of the payment cycle
- Pay bills in a timely fashion to foster positive relationships with suppliers
- Conduct credit checks on new customers before extending credit to them - a client with a good credit history is more likely to pay you on time