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Business start-ups: how do you manage your cash flow?

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Organising your company’s cash flow isn’t always the easiest task. One of the main mistakes you can make when you’re setting up a business is focusing purely upon your business goals.

While it is important to have business goals, it’s more important to make sure they don’t eat too much into your cash flow. Creating a constant steady cash flow should be your first priority. The question is how can you do this?

Understand your expenses

In order to get a grip of your finances, you need to first understand your expenses. Work out how much you have to pay each month for various expenses. What are your overheads?cash flow

Once you know how much you are paying out, you can then work out how much you need in order to make a profit. You should always know your outgoings before you even think about offering discounts on your products/services.

Taking a good look at your expenses will help you to see whether you are currently breaking even, making a profit or whether you’re set to make a loss.

Create bundle offers

One of your main concerns is creating a steady cash flow. To do this you need to constantly draw in new customers.

Creating a bundle offer will attract new clients/customers and help to boost your business. An example of this would be if you were offering double glazing. You could include the windows and doors for a discounted price. Of course, you need to make sure these offers don’t cause you to make a loss.

Take a look at your expenses so you know how much you can afford to discount on various products/services.

Generate repeat business

One of the main mistakes businesses make is focusing solely upon new customers/clients. If it’s steady cash flow you’re looking for, you need to make sure your existing customers are also happy.cash flow 2

You can do this by offering various incentives for repeat business. This could be a free gift after every fifth purchase or something similar. You could even create a loyalty program where customers earn points each time they shop with you. This type of offer is extremely popular and will definitely help you to keep many customers coming back for more.

Think of ways to make up initial discounts

If you are offering a discount to attract new customers, there are ways you can make the money back. Say you’re offering a catering service; you could provide your services free for the first hour and then really bump the prices up after that. You do have to be careful when doing things like this. Customers are becoming savvier when it comes to seeing through marketing deals. Think of all the ways you can increase your prices without it being too noticeable.

These are some of the ways you can help to ensure you have a regular, steady cash flow. Once you have a steady stream of income, it is then you can really focus on building up your brand and offering more attractive sounding discounts.



About Jemma Porter

About Jemma Porter

Jemma Porter is an experienced content creator who has written for a number of online publications. A self-confessed penny pincher; she's often found seeking out the best personal finance deals.

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