3 tips to staying one step ahead
The business world is more competitive than ever. In order for your business to grow, you need to be one step ahead, or as many steps ahead as you can be. Being ahead can help to give your business a competitive edge. You understand the different components of your business now, but how do you anticipate for the future?
Here are three items your business should be on top of to be able to get ahead.
1. Your bills
Bill, bills, bills, every business has to pay them. The main aim is to maintain a healthy cash flow so you can pay your bills on time. Sounds easy, but understandably it can be one of the biggest challenge any business faces.
It’s crucial to know what needs to be paid and when. Map out on a timeline or put a reminder in your calendar of when your bills are due. You can definitely plan for outgoings such as electricity or wages, which leave your business at regular intervals. Setting up direct debits and standing orders can help to make this process easier for you.
By pre-empting when your outgoings are, you can ensure there is enough cash in your business to pay bills and suppliers. This can help you maintain a steady and consistent cash flow. Bear in mind seasonality as well. Although business will be quiet, you’ll still need to pay your bills on time by having put enough cash aside beforehand.
2. Your customers and suppliers
Customers and suppliers are vital to the daily operations of your business. Knowing who they are and gaining as much insight into them as possible can help you to make informed business decisions.
To be able to supply to your customers, you need your suppliers to continually be providing their service to you. For them to be able to service you, your customers need to pay you to continue building relations with suppliers. It’s a cycle that cannot be broken.
Understand your customers and suppliers past and present to be able to predict their behaviours for the future. It can help you to choose the right people to work with, as well as setting the appropriate payment terms.
3. Your collections
This is detrimental to the cash flow of your business as it is part of your income stream.
Knowing where your debts are is just the beginning. What about which ones to collect first to minimise the risk on your business? Most businesses will chase the oldest debts, but these could be the ones with lowest risk. Be ahead of your debts and collect them before you risk not getting paid.
Staying on top of your collections can help towards maintaining a healthy cash flow for your business.
Be one step ahead of your bills, customers and suppliers by credit checking your own company and others. See what your business credit report says about you and look for ways to improve. Credit check your customers and suppliers to anticipate whether they’re a business that will pay on time, or whether they can carry on supplying to you in the long run.
Get on top of your debt collections by using Ledger Manager, helping to prioritise your debt collection for you. It attaches risk to each of your debts so you can see which ones are most at risk that you should be collecting first.
Are you looking to minimise your business’ exposure to bad debt and make informed business decisions every day? Qualify your customers, suppliers or contractors with Experian UK Business Credit Reports. Speak to one of our agents today to claim your free trial.
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Posted on by Cindy Yip
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