Running a small business is as challenging as it is exciting. Everything about the small including its current scenario and future trends depends upon the capital it has. Lots of companies/ startups/ small businesses do not see the end of their first year, mostly due to a lack of funds. This speaks volumes about the significance of maximizing cash flow for small businesses.
In this article, we talk about ways to increase the influx of cash flow while also addressing other merchandising solutions. The tips shared have been curated for small business owners keeping in mind the challenges and opportunities available to them. However, this serves as a guide for small and moderate businesses alike.
Tip 1: Have an Emergency Cash Reserve
Emergency funds have a very elemental purpose to serve, something to fall back to at the hour of crisis. They not only offer you flexibility and security throughout the economic ups and downs, but they also aid in crucial decision-making during economic uncertainty.
Experts suggest keeping at least 10% to 30% of the annual revenue aside as emergency cash. This roughly makes up expenses for three to six months. Although building an emergency cash reserve that keeps on growing as your business grows, does limit your investment abilities but it has far greater positive outcomes.
Setting up an emergency cash reserve reduces your risk of going out of business, protects your funds from getting mixed up in your business processes such as sales merchandising or sales merchandiser, and helps you avoid credit and late fees issues.
Tip 2: Upgrade from a Spreadsheet to Software
There is an interesting transition every business is going through. We are in the era of the fourth global industrial revolution, where data drives everything. The spreadsheet has served its purpose and has overachieved more than we expected it to. But it’s time to call it a day for spreadsheets.
Tip 3: Drive promotional sales
To put things into perspective, we generated 98% of the entire world’s existing data in the last two years. And this number is only going to grow. While spreadsheets are a perfect tool to present, study and analyze moderate amounts of data. However, with the advent of big data and the opportunities it brings, businesses have to move towards software and codes that possess the capabilities of handling such data. Organizations that have already made the move are reaping benefits. It’s time every small business does that too.
The rise of technology and social media has disrupted the marketing industry by annihilating the traditional sales channels of companies. By removing the middle persons from the chain, it has brought the customers in direct contact with the OPs.
That also means that the customer is in contact with your peers and industry leaders in the market. In situations such as this, selling as much as you can increase your cash flow and promote the brand in the market. This is termed product merchandising and experts believe it to be one of the best ways to increase cash flow for small businesses.