Times Are Tough! How Can I Manage Business Cash More Effectively?

manage cash flow

We are at a critical time in the UK where we have to swim through some pretty thick waters. Prices are ever-increasing, interest rates are rising, and the word recession is flashing over our heads every day. For small to medium-sized businesses, the need to understand and manage cash flow is at vital levels. Not only is it vital in maintaining resilience in the face of such deep waters – but in adopting more flexible strategies to succeed within them.

Happily, this is where professional bookkeeping services come to the rescue, helping to wade through these murky depths to find an island of hope to build upon. Let’s look into managing your business’s cash in these tough times.

What is Cash Flow?

For starters, let’s determine what exactly the cash flow is. Cash flow is a measure of the amount of cash flowing in and out of your business during a specific period.

Positive cash flow is having more cash coming into your business than going out. A negative cash flow is the opposite – when you are bleeding money out of your business that heavily outweighs what is coming in. Monitoring this cash flow and understanding it is crucial, because if you have an extended period of this cash flow being in the negative bracket, paying your bills and covering your expenses is going to get tough.

Some businesses are more likely to experience cash flow problems than others. Some will give better resilience against it. As a business owner, you will want to know which of these your business falls into – even if you have an inventive or straightforward business model.

That is where small business bookkeeping solutions come into play.

Managing the Flow

The first act of understanding and predicting your cash flow is having a health check carried out on your business accounts. Looking into your latest profit and loss statements and checking that the income is sufficient to cover your expenses is an area your bookkeeper will give the best guidance.

If your profit is falling behind your expenses and cash flow is slowing to a crawl, action will need to be taken. The best step is working with a bookkeeper to prepare a cash flow statement that highlights where your money is going. From there, you can create a yearly budget and uncover the months when cash will become tight and where savings are available.

There may be the opportunity to become more flexible with working patterns during the less busy months, looking into ways to alleviate the outgoings during that time and stopping the haemorrhaging of cash when work is slower.

Time to Collect

More importantly, your bookkeeper will help you get on top of collecting the money from those who owe you – and do so much quicker. There is nothing more frustrating than outstanding invoices, and bookkeeping services in Manchester can help you get what is rightfully yours.

Need help getting your cash flowing as it should? Contact the team at Pebbles Bookkeeping for more information and help.

What our clients say…

A massive thank you to Diane at Pebbles Bookkeeping & HR. You took the huge stress away from where do I start, with employee policies etc. You have created us a great, informative employee handbook, covering all necessary policies and risk assessments in a matter of no time and from the other side of the world too. I will definitely be in touch for any future help our company needs.

Lisa Heggie, The Gunnery

I just wanted to thank you both for the help you’ve given me thus far in setting up my new cloud-based bookkeeping system ‘Clearbooks’.

Having used Microsoft Excel for more years than I care to admit, I had more than a few reservations when considering changing the way I managed my books, yet understood that I had to make the change sooner or later.

After an intense training session with Sean, (where I probably asked 101 questions), my fears quickly dissipated and I can honestly say that although it’s likely to take me a little while to really get to grips with the new interface, I’ve no doubt that this simple system will save me so much time and hassle in future.

And less time spent doing my books, almost certainly means more time with the family and an end to rushing around like a mad woman at quarter-end!

Thanks again and I’m looking forward to working with you again soon.

Anne-Marie Armstrong, Amberry Marketing

Diane has been providing her services to my company for approximately 6 months now and I can honestly say that due to her assistance, my company is running a lot more smoothly than it has at any time over the previous 30 years that it has existed.

I would just like to say that I would recommend her services to any business, whatever the size, as I can only see that her services would be beneficial to any company that may choose to employ her services.

Wayne Dinning, Managing Director, SD Waste Paper Limited

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