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We cannot stress enough the importance of a healthy cash flow to ensure the smooth running of your business. However, in times of crisis such as the ongoing COVID-19 pandemic, this becomes more than important – managing your cash becomes a necessity for survival.

If you are experiencing cash flow troubles, here are five things you can do to manage your cash flow better.

1. Check your expenses
   

   Now is the perfect time to review where your money is going and check which expenses can be minimised or eliminated completely. Re-evaluate your expenses and decide which ones are essential and should stay, and which ones can be trimmed down or cut altogether.

2. Negotiate your debt

   Initiate a discussion with your lenders if interest only or deferred payments on outstanding debts is possible.

3. Reduce your rent

   There are some government-backed rent assistance schemes which subsidise a portion of your rent and/or require landlords to waive part of it. Aside from this, there are other ways you can reduce your rent. Check if it makes business sense to move to a smaller, or otherwise more affordable, commercial space within your budget. You may consider closing down offices or stores that are not performing well.

4. Request more flexible payment options

   It never hurts to ask, especially if you’ve been transacting with your vendors for a long time and you’ve established a certain level of mutual trust and confidence. You can request for more flexible payment options or longer payment terms.

5. Tap into available credit lines

   Take full advantage of any available supplier credit. You can use the funds to reduce expensive overdraft and credit card interest.

Assessing your cash flow is fundamental to gaining a better understanding of your business’ financial health. As cash flow experts, we can do your monthly, weekly, or even daily cash flow statements. This gives you visibility on where your cash comes in and goes out to. It also allows you to plan ahead to maintain a healthy cash flow.