There are times when there simply isn’t enough money in your business bank account. Yet, your overheads have no mercy. Everyone, from vendors to employees, is expecting a check. While you may be able to survive this month, you may not be sure about what happens next. The only way out is to face the problem head-on. Here are three things you can do if you’re struggling with cash flow.
Cut out waste
Many businesses are being dragged down by invisible dark forces. These forces are made up of hidden expenses that don’t bring in any profits. For example, there could be suppliers who are overcharging you for products. Or, you may have an employee who is not pulling their weight. Yet still, you may have equipment that uses too much energy. These and other factors could contribute to the lack of cash in your business.
Sit down with an accountant and look at your numbers. Pay special attention to anything that seems not to pay for itself. Don’t be afraid to cut out activities that are not profitable. When you find an issue, grab the bull by the horns and address it. You might be faced with some tough decisions. But, that’s all part of being a successful business owner.
Boost your marketing
This piece of advice may seem counter-intuitive. Yet, after careful examination, you will likely find that this is a crucial piece. Here is the thing: many business owners make the wrong decision to reduce their marketing budgets when things get hard. While this may provide temporary relief, in the long-term the results can be disastrous.
Marketing and sales are core business activities designed to bring in new customers. If you restrict your marketing resources, you’re essentially reducing your chances of making more money. You could say, you’re killing the goose that lays the golden eggs.
In some cases, you may feel that your marketing is not working. You would be justified in thinking you shouldn’t spend more money. However, the right approach would be to improve your marketing, not to cut it out. In the same vein, if it’s working you might want to put more money in.
Apply for a business loan
There are times when the only way you can get out of trouble is with a fast cash injection. Applying for a business loan might be the way to solve your problem. If you choose to go this route, make sure that you’re fully aware of what you’re doing.
When discussing your needs with lenders, it is especially important to be clear on the loan’s terms. You should also have some confidence about how you’re going to get out of the crisis situation as well. Otherwise, you may find yourself only delaying the inevitable. Figure out the root cause of your business issues, even if you get some cash to pull you out of your current predicament.
Dealing with hard times requires you to be brutally honest with yourself. In a way, this is a true test of who you are as a business owner. At the same time, don’t be afraid to ask for help. You can’t do it all alone!
As your next step, read over the above tips once again. Then, write down a list of things you can start doing today. Little by little, check off each item. Keep moving forward, one step at a time. If you stay focused, you’ll be in a much better position sooner than you can imagine.