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Ten Tips To Improve Your Small Businesses Cash Flow

February 18, 2013 By Gerwyn Wallto - Guest Poster For WorkAtHomeTruth Leave a Comment

A consistent and reliable cash flow will give a small business owner the ability to control how they use their resources to improve their business. Knowing that you have more than enough money coming in to cover your expenses will give you the power to plan the best way to use the excess. On the other hand, if you don’t have enough coming in, it will also give you the ability to make changes in advance, so you don’t end up losing your profits to bounced check fees and interest.

Here are ten quick tips on how to improve your small businesses cash flow:

1. Negotiate longer terms with suppliers.

In tough economic times, suppliers are usually more willing to work with you on establishing agreeable payment turns, so they don’t lose their valued customers. Ask your supplier if you can arrange 45 or even 60 day terms, if you place a small deposit upfront. You should also make sure to space out when your payables are due, so you don’t have everything due on the first of the month.

2. Check client’s credit references and payment history.

Always do your homework when dealing with a new business to ensure they have a good reputation for paying their receivables on time. A receivable won’t help your businesses cash flow, if it is never paid.

3. Offer clients incentives for early payments

Every successful business is always actively looking for ways to save money. By offering your clients a 1-2% discount for payment within 15 days, it will improve your chances of receiving payment earlier.

4. Send invoices immediately

Handling your invoicing online will allow you to quickly enter an invoice and email it directly to the client. There is no need to wait for snail mail when there is email. In most cases, the sooner it is in their hands, the sooner you will get paid.

5. Send reminder notices

It never hurts to a client a little nudge before an invoice is due. A professional and friendly reminder notice may help move your receivable to the top of a company’s payable list.

6. Expand your customer base

Many small businesses land one or two big clients and rely on them to keep their business afloat. To improve your cash flow, work on landing smaller accounts that can fill in the gaps while you are waiting on a cheque from a big client.

7. Look for ways to reduce costs 

There are always ways that you cut unnecessary expenses. Labor is a major expense for most companies and there are less expensive alternatives available online. You can hire a part time freelancer or use an online provider for services that don’t require a full time employee. You can also eliminate luxury expenses, like membership dues, that are not earning their keep.

8. Create a cash flow reserve for emergencies

If you take a small percentage of your earnings and place it in a separate account, you won’t have to rely on credit when an emergency catches you off guard. Every business needs a financial safety net.

9. Review your cash flow statement regularly.

You can’t avoid or fix a problem, unless you know it exists. Regular monitoring of your cash flow is essential. Regular assessment will allow you to make adjusts, follow up on debts, and stay in control of your finances.
Cash Flow

10. Compare your rates to competitors 

Many small businesses price their products or services based on they feel it is worth, rather than what a customer may feel it is worth. Check your businesses’ pricing against similar businesses to make sure you are not undercharging or overcharging.

The article is posted by Gerwyn Wallto. You can find other related articles here.

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Filed Under: Finances Tagged With: pricing, debts, check, D., ... ..., changes, New, small

Voicemail Vs Answering Your Own Calls Vs Using An Answering Service

February 15, 2013 By Jeremy Esto - Guest Poster For WorkAtHomeTruth Leave a Comment

The telephone was first introduced to the public just a little over a century ago. But those who bought them and installed them in their homes and businesses quickly found out that they came with a problem. That problem was that someone had to be there to answer when it rang or a call was missed.

So not long after that, inventors began the decades of work of coming up with workable solutions. The first solution they hit on was an answering machine that used newly invented magnetic recording tape. It was made out of wood, weighed in at close to 100 pounds and stood just under 4 feet tall. It also cost the equivalent of about six months wages for the average working person of that time back in the 1930s.

So obviously there was plenty of room for improvement. Fast forward to today, and now you have your choice of three options when it comes time to field incoming call, and one of them what is voicemail which is the technology that came along to push out the answering machine. But there is a relatively new service as well they came as a result of call rerouting technology that was developed back in the late 1970s, and that’s an answering service.

The article following is a three-way, side-by-side comparison that list both the pros and the cons of the three choices that you have, beyond hiring a personal assistants to sit all day to field your calls. Those three choices are to use voicemail, to go with a phone answering service or simply pick up your calls and go without those that were missed when you weren’t there when the phone rang.

Voicemail: Pros

The first big pro going for voicemail is that it’s cheap and effective. In fact you would have to move to a foreign country to find a phone service that charges up for it now. Just record a short introductory message, and when a call comes through and you can’t be there to answer it, it automatically picked up, the message is played and the caller can leave a message of their own. All very simple to operate.

Voicemail: Cons

The first downside of voicemail, for businesses in particular, is that recent studies have shown that up to 30% of callers will simply hangup as soon as they encounter your initial greeting message. 30% is a lot of potential business to simply ignore, but surprisingly some businesses today still choose to do it. Then for those who do get through, there’s no corresponding and too often by the time the message is heard, in terms of business it’s too late.

Answering Your Own Calls: Pros

Then there’s the option of answering the phone calls yourself, and a lot of people in a lot of homes do just that. If you call when they aren’t there though, the call goes unanswered. So it’s a nice throwback to the simpler days before the first answering machine was invented. Another big benefit here for the caller though, is that they’re assured that the person that they are calling will be the one who answers the phone, even if it doesn’t happen every time that they want it to happen.

Answering Your Own Calls: Cons

So while it may all sound all nice, nostalgic and personal, none the less there are a whole lot of downsides to taking this route. For business operators in particular it would be financially devastating, that is unless they have a religiously devoted return customer base. Even then, this option really is only for a person who’s content with not knowing at all what the callers that they have missed had on their mind.

Answering Service: Pros

This third option is also the fastest-growing in terms of popularity. So more people are opting for it and the first reason is a live personal response 24 hours a day, every day of the year. Then for businesses the list of benefits are many and continue to expand. The option of an industry specific service is just one benefit, such as an answering service that caters to healthcare businsses, for example. Then for owners and managers who are marketing online there’s an ever increasing list of web-based marketing assistance service options as well.

Answering Service: Cons

There are however, a couple of glaring answering service cons that may have you thinking twice before you sign up. This first one is that now with 24 hour a day call forwarding, having priority calls directed to your personal phone means that as a business operator you can end up going without needed rest away from closing transactions. Then of course, there is the cost, and with both of the above options coming absolutely free, this is for sure the most expensive option.

A Few Final Words

Something that’s important to consider when comparing costs for a business operator is that there are both front end, and back end costs to consider. So while one option may be cheaper than the other in the beginning or the front end, on the backend as time moves on other costs do rack up due to business losses as a result of missed calls and messages not left.

Featured images:
  •  Image credit Cheap photos
Written by Jeremy Esto. I have over 10 years experience in the call center industry and now work for a company called CourteousCom.com.

If You're Struggling to Make Money Online Click Here to Get Answers to All of Your Questions About Making Money Online.

Filed Under: Business Management Tagged With: answering service, benefit, fact, business, marketing, No., wood, article

Accounting Requirements for Start-up Businesses

February 12, 2013 By Guest Post Leave a Comment

Starting a new business requires knowledge of many business functions. One function that is crucial to the success or failure of a start-up is accounting. This is one aspect of a business that needs to have the most attention. Individuals who find this task daunting can use an accountant to help them get a leg up and their business off the ground. Hiring an accountant is only one step in the process you will follow for starting a business.

Business Plan

A business plan is the first step in starting a new business and will include many details. This includes a definition of the business, an outline of goals, and products or services being sold. The plan will also include specific operating procedures and any competitors. Business plans are required for any funding that comes from venture capital or a traditional bank loan.

Marketing Material

Your business will require a name and a logo to use for marketing and promotion. You can then make a business card and print up and stationary. These will help you to start building your brand and establish an identity for your business.

Business Structure

You have the option to create a new business as a sole-proprietorship, as a limited liability company, or one that is incorporated. The structure of the business is meant to shield you from the liabilities and the debts of the business. The proper structure for your business can be discussed with a local attorney or with a professional accountant to determine the best option. There are also tax advantages to having a business formed as a limited liability company or as a corporation.

Accountant and Attorney

The selection of an accountancy firms or attorney for your new business is a benefit to help you succeed. They will be able to offer legal and financial advice that will help you achieve success. You can get a referral from friends and family members or look online for accountants and business attorneys in your area. A good idea is to find a professional who has experience with the needs of a small business. Your best bet is to find a professional who is knowledgeable in the industry for your business.

Legal Requirements

This is the process of registering your business in the state where you reside. You will need to file for a federal tax identification number or an employer identification number for your business. Any business formed as a limited liability company or as a corporation and is required if a business has employees or workers. This can be done by contacting the tax department for your state.

Business Insurance

The accountant that you hire can help you determine the amount of assets that you need to insure. Your next step is to discuss your needs with a local insurance agent. Most businesses will need to meet specific requirements that have been set the state where the business resides. This includes the need to pay for a workers compensation policy if a business has employees.

Bank Accounts

Discuss with your accountant the best way to separate business finances for personal assets. You do not want to expose personal assets and funds with anything related to your business. The next step is to see about opening a bank account in the name of your business.

Ongoing Needs

The expenses for your business, tax preparation, and the creation of a budget will require help from the accountant that you hired. Taxes need to be filed each year and expenses can be calculated on a weekly or monthly basis. A budget is typically developed for your business each year.

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Filed Under: Finances Tagged With: pay, logo, services, Task, legal requirements, employees, print, best way

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