6 Tips to Increase Cashflow Without Landing More Sales
So... I think we can all agree that 2024 has been quite the interesting year for business owners. People are nervous about the economy, there's a lot of uncertainty with things going on in the world. Not to mention hurricane Helene and now Milton (if you're from Florida or have family there, sending all the love and prayers 🤍) and it being an election year. Things are a little crazy.
That adds an extra layer of stress on business owners trying to run a profitable business, reach your goals, provide for yourself and your families, etc. It can be stressful going after sales, having countless discovery calls, and pitching yourself like crazy. Obviously it's good to continue marketing, putting yourself out there, networking, and connecting with potential clients and business friends.
But that's not the only way to increase your cashflow and profitability! Keep reading for 6 tips to increase your cashflow without landing more sales:
Reduce Expenses
Review your current expenses and identify areas where you can cut costs. This might include renegotiating contracts, finding cheaper suppliers, or eliminating unnecessary services (and subscriptionssss). In order to see exactly what's going out of your bank account and what it's for... yep, you guess it. You have to have your bookkeeping done and up-to-date 😉 Otherwise you might not catch that $300 subscription to a software, program, membership, etc. you never use.
Speed Up Receivables
Speeding up receivables can be really helpful for maintaining a healthy cash flow. One effective strategy is to offer early payment discounts. This small incentive can motivate customers to settle their invoices sooner. It's also important to have clear and concise payment terms. Make sure your clients or customers know the due dates and any penalties for late payments.
Another way to speed up receivables is with automated invoicing. This ensures invoices are sent promptly, reducing delays. Setting up a system for follow-up reminders can keep payments on track by gently nudging customers before and after the due date. Another option is to set up recurring invoices with an automatic payment required. Tightening credit terms, such as requiring deposits or shortening payment periods for new clients, can further enhance cash flow as well. Lastly, offering multiple payment options can make it easier for customers to pay quickly. By implementing these strategies, businesses can improve their cash flow without the need for additional sales.
Refinance Debt
This isn't always going to be the best option, but if you have a loan or credit card it's work looking into refinancing to secure lower interest rates or better terms, which can reduce your monthly payments. Additionally, refinancing can help streamline debt management if you have multiple loans and/or CCs by consolidating multiple loans into a single payment, making it easier to track and manage. Overall, refinancing can provide a financial cushion, offering businesses more flexibility and control over their finances.
Increase Prices*
If possible, slightly increase your prices. You can do this with existing clients, especially if you've added/improved the service you offer, or new clients. If you're maxed out on your capacity, and still have people wanting whatever product or service you offer, it might be time to do a price increase. You can do this for one-off services like a brand/website design project, or monthly retainer services like social media management or even us here at Profit Priority with our bookkeeping and CFO services. Even a small increase to your project or monthly fee can significantly impact your cash flow without needing more sales.
Offer Subscription Services*
Introduce subscription models for your products or services to ensure a steady stream of income. We offer one-off services (like a strategy session or our VIP week) but the majority of our clients are on a monthly retainer. I mentioned this a little when talking about speeding up receivables, but we love this strategy because then you have that monthly guaranteed income. When you have clients on a subscription model, you know exactly how much will be going into your bank account and when
Improve Operational Efficiency
Streamline operations to reduce waste and improve productivity, which can lower costs and increase cash flow. One of the best ways to do this is with a time audit. It's honestly such an underrated profitability tip and I recently talked more about that in this blog post. If you've been around a while you know we live and breathe ClickUp, and that's what we use to keep things at Profit Priority organized and streamlined with our team to increase efficiency. We also use it to track our time!
Business can be discouraging sometimes, especially when times are tough and sales might be lower than you'd like. But there's so much you can do to increase your profitability and cashflow that's within your control! Hopefully these tips help (*these are my favorite), and if you try any out, let us know how it goes!
