6 Effective Ways To Improve Your Cash Flow

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Based on my last post, we talked about cash flow and how important it is in our business start up. (click here to read my previous post)
This time we will talk of the simple strategies and business ideas to increase your cash inflow.

Actually, I've combined the personal lessons that I have learned in my business as well as from the books that I have read.

1. Pay your bills on time
Often when we start a business we use leverage to our advantage like OPM (other peoples money) and OPT (other peoples time). The problem with leverage is that it is a double edge sword. It can either drown or keep your business afloat.

6 Effective Ways To Improve Your Cash Flow

Cash Flow Is The Life Blood Of Your Business Start Up

picture source: http://www.flickr.com/photos/joeshlabotnik/

As like many business start ups, we are most satisfied when our accountant shows our income statement having a healthy profit, yet it doesn't really show the entire picture. This in fact is misleading specially if you are not good at reading financial statements. 

One of the biggest mistakes made by most business start up owners is allowing clients and customers to buy now and pay later. In other words, extending credit in exchange for your services or product.

I believe there should be a big line between you as a business start up owner and credit. The business idea is, since you are still at the start up level, cash flow is the lifeblood of your business. Without cash flow, your business will slowly wither and very soon, it will cause the closure of the business. Irregardless of how many sales you made or how much money is owed to you, without cash flow, your business start up will be short lived.

Cash Flow Is The Life Blood Of Your Business Start Up

Nurture Your Customer Relationships

Just yesterday, I went to check on a new style of badminton shoes for myself in a small sports store across the highway of my hometown city (how I wish I was in a city like London). The name of the store is Racket Plus and I had bought most of my badminton equipments there.

As I was trying on their new stock of badminton shoes like the ones from Mizumo, I was expecting that I will be entertained by one of the sales agents but surprisingly, I was approached by the owner himself and he greeted me using my first name.

Our conversation centered mostly about shoes; where they got their supplies, how they handled their inventory, and marketing. Of course, he asked me what I did for a living and how I got to know their store. Through out the conversation, I noticed from him a very important trait that any business start up should have and that is nurturing his relationships with his customers.

As a sales and marketing person myself, I am a bit keen and very particular to customer relations. Although in essence, I do not fully agree with the belief that the "customer is always right", yet I have a bias on the importance of the customers' right to know. For me, there is no business if there are no customers. We business people exist because we are there to provide and serve our customers.

Nurture Your Customer Relationships