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Taking a peek inside the minds of small business owners

What financial topics are on the minds of small businesses right now?  To find out, I recently surveyed clients and friends, asking them to rate their areas of concern. While the results are not scientific, they are quite interesting.

Here are the top three areas labeled “of major concern” in the survey:
  1. Finding new sales
  2. Tracking cash flow
  3. Tightening up inventory management

We will leave the topics of “finding new sales” and “tightening up inventory management” for another day.

For now, let’s focus on…

Tracking Cash Flow

“Cash is king!”

It is an adage, but never has it rang so true.

Do you know where you stand with your cash flow management and forecasting?

It is imperative for small businesses to have their thumb on the pulse of their cash in, cash out, and most importantly, the gaps between them in the coming weeks.

Tips to improve your cash position

While there are several levers to consider when managing cash, here are three suggestions to help strengthen your position:

A laser focus on your accounts receivable

Every dollar sitting in your receivables is a dollar that can’t be used for other business operations.

Make sure that you are reviewing your unpaid customer invoices every week, and promptly following up on those near the due date and/or overdue. Flexibility is certainly important in keeping customer relationships solid, but you can’t afford to be the bank right now by financing outstanding customer invoices.

Even better, see if there is a way for your to get a prepayment or deposit on future orders!

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Avoid the “bright shiny object” syndrome

This is a fancy way of saying to buy used instead of new whenever possible. 

Or, consider buying a lesser model. For example, is it really necessary to buy that $1,000 phone when a less expensive model will do? Can you hold on to that existing phone for another year before upgrading? Be scrappy and keep the savings in your bank account.



Lower your cost of debt

Do you know the costs for that loan you took out with that “hassle free small business online lending site”? Do you know what the rate is on the unpaid balances of your credit cards?

I am frequently surprised at how often business owners aren’t armed with this critical information. And don’t even get me started on the loan paperwork I recently saw with an APR of 60+% (no – that is not a misprint).

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Tools to track your cash position?

Use QuickBooks desktop? It has a “cash flow projection tool”. This is a very basic tool that can take a look at the next six weeks of money in and out in your business.

Use QuickBooks Online?  QBO does not have any built-in solutions today.

Using a homemade Excel sheet? For some businesses, this may work ok. However, all it takes is one error in a formula and things can get out of whack quickly. We hate it when things are out of whack, right?


Enter CashFlowTool

If your business is looking for a way to automate the management and forecasting of your most prized asset, look no further than the CashFlowTool solution.

Did I mention that this application connects to both QuickBooks Desktop and QuickBooks Online to make things even simpler (no double data entry needed!)?

CashFlowTool is one of the most powerful, yet easy to use solutions I have seen when it comes to managing your cash.

Even better, the team at CashFlowTool has a Lite version for free and has also lowered their pricing for their Pro version for just $50/month. Now is a perfect time to tap into this terrific tool so you can keep your thumb right where it needs to be – on your cash flow management.





CashFlowTool is a product developed by Finagraph. We're a technology company that's passionate about helping small business owners, accountants, and lenders deeply understand the financial health of companies. Finagraph’s trusted technology helps power services provided by companies including Moody’s Analytics, Jack Henry & Associates and leading banks. Learn more

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