How to Survive A Christmas Cash Flow Problem

Thomas Taylor - Saturday, December 03, 2016

It's common for businesses to have problems with cash flow in January. Expenses seem to pile up in December and your clients are off on holidays in January when you call chasing payment. Or they are short of cash too?

There are a few things you can do now to help reduce the pain.

Firstly do a proper cash flow forecast. Once you, or your accounts person, have been shown how to do one it's not hard to get started and keep it up to date each week. I recommend people do a cash flow forecast first thing Monday morning. If you talk to any successful business person they will tell you the importance of managing cash flow. Happy to send you a free template.

Make sure you invoice your clients as quickly as you can. Don't wait till the end of the month to send out invoices, do it continuously.

Follow up late payments early and often. Set up an email template in Xero for polite reminders of overdue payments.

Jump on the phone. Build good relationships with customers so that if you need to ask a favour they would be more willing to help out. Never be rude.

If you're worried you might be a bit short you can connect a new breed invoice financing account like Waddle to Xero (and other accounts systems) and use it as an emergency source of funds.


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