3 Ways to Solve Cash Flow Problems In Your Business

Problems with cash flow is not uncommon for businesses, smaller businesses in particular: a 2010 Discover Small Business Watch survey found that 50 percent of small business owners claimed cash flow problems.

Being short of funding can of course be stressful and incredibly frustrating, but there a number of ways in which you can mediate and solve your financial issues.

Consider Getting a Merchant Cash Advance

Getting a merchant cash advance in the UK is generally a very simple process. One of the greatest benefits is that this alternative funding option comes interest-free and the repayment process is very flexible.

Instead of being charged interest, you have just one clear, fixed-fee to repay, and the amount you pay back is always made in accordance with your monthly revenue. So, if for example, one month your earnings are slightly lower than usual, the amount you repay that month will in turn be less, which is of course hugely beneficial for maintaining healthy cash-flow.

The application process for a merchant cash advance in the UK is also extremely quick and easy: you are able to apply entirely online, and the process generally should use up only a few minutes of your time. Most applications tend to be accepted, as you are assessed on your monthly card sales as opposed to a perfect credit score. Once your application has been accepted, you can expect money to be in your bank account within just a few minutes and your cash flow problems will be sorted.

Consider Taking Another Look At Your Budget

Sometimes a businesses’ cash flow problems can be due to continual or excessive over-spending. It is important to keep track of your monthly expenditure, which you can easily do through a spreadsheet. Consider whether there are some areas where your spending could be reduced: could you buy stock in greater bulk to reduce the overall cost? Could you print less to save on ink, or bring down your electricity bill by using energy saving light bulbs?

There are numerous ways to reduce your spending, large and small. The point is, it all adds up and if you don’t pay attention to where your money is going, you can easily end up being short of it.

Encourage Your Customers To Pay Sooner

If you are struggling with cash flow problems, you should certainly try to incentivize your customers to pay for goods or services sooner. Often business owners can feel awkward or even rude when asking their clients to pay upfront, but if this would better suit the type of business that you have, you should definitely consider it.

Furthermore, many people are actually more than happy to make payments upfront, provided you have a reliable reputation. Setting up an auto billing system would also speed up the payment process: on the same day of each month, money is directly drafted from your client’s bank account, or is charged to their credit card. This will consequently allow you to know exactly when the money should come through to your account, allowing you to better plan and thus keep your cash flow steady.

Making adjustments to reduce your expenditure and increasing the speed with which your revenue is received will surely help you mitigate your cash flow problems. However, for a quick fix solution you should certainly explore the option of getting a merchant cash advance.

The rapid influx of cash provided by a merchant cash advance allows you a much-improved cash flow, and a brilliantly flexible repayment scheme that will leave you stress-free and fully able to focus on the growth of your business.

Adam Hansen

Adam is a part time journalist, entrepreneur, investor and father.