4 Solutions for Fixing Your Short-Term Cash Flow Issues

Not many businesses can boast having a steady profit all year long – this is perhaps a characteristic of large enterprises, while small businesses sometimes have months which are less lucrative than the others. The first thing to know as a business owner is that those short-term cash flow issues are nothing alarming if addressed promptly. Even if your cash flow issue is a result of a small mistake, you can push through it and come out stronger and more experienced. So, if your business gets into a slight financial jam, the best advice is to assess the situation and possible solutions calmly. With that in mind, here are 4 potential solutions to get you back on your feet.

Organize a flash sale

If the necessary cash infusion represents an amount that gravitates close to the healthy business margins, then flash sales can be an answer to your issues. They are especially convenient if you are selling products and not services and although the income will be lower than it would be if you sold the products at regular prices, this quick solution will bring your business back on track. The excitement of low prices with a clock ticking is irresistible to most consumers so there is a big chance that, besides your regular customers, you will also attract new ones and thus increase your customer base. Resolving your cash flow issue and gaining new customers in one fell swoop – how’s that for a flash sale!

Push the prices up

Although this sounds like a strategy which would be highly unpopular with your customers, it does serve its purpose. If your cash flow is experiencing bigger problems and you simply don’t make enough, perhaps you need to analyze your prices. You can do so by taking a sneak peek at your competitions’ offer and prices so you can make a decision on the level of the increase. After you decide on the increase and implement it, you need to be ready to lose some customers. This is only natural but it mustn’t discourage you as once some time passes, you will gain new ones who will not have a problem with your quality and price ratio but might even think that the prices should be higher.

Leverage on your credit score

If you have so far conducted business within a healthy margin, you would most probably have a sound credit score. This will allow you to apply for fast short-term business loans which are convenient because the application process and the repayment plan are neither complicated nor slow. When taking out regular loans, when assessing your eligibility, a lot of elements need to be taken into account so the decision-making process might be long. This is something you cannot afford if you need an urgent financial infusion and not to mention the repayment plan which might take months to pay out.

Be attentive of who you hire

If you have a chronic cash flow issue that isn’t related to a particular time of the year, it might be that your employees are just not cutting it. You need to conduct an audit and see who is slacking, talk to them and become aware of what might be causing them to behave in such a manner. If it is the workload which might be too massive for them to handle, you might need to hire new employees. It might seem unreasonable to hire new people when you are strapped for cash but if you hire the right person, things can be changed in a flash. For instance, an experienced accountant might help you resolve your cash flow issue more efficiently than you thought it was possible but also, you might need to fire people who were responsible for the issue which arose in the first place.