When you start a business, you have to pay attention to the factors responsible to expand it as well. Sometimes you may focus too much on increasing your sales and remain oblivious to the financial factors that can actually help your business grow.
We’ve created a list of things that will help you make sure that your business is financially sustainable:
1) Keep a track of your cash flow
Cash flow is critically important for MSMEs and it is important to have an incoming positive cash flow which will keep you in profit. One should also make the crucial note of checking their accounts. This will not only keep your business safe but give you the opportunity to understand about your unnecessary expenses and keep them in check. Make it a point to create a profit and loss statement summaries which will help you determine your profitability over time and then look for ways you can cut your cost and increase your income by analysing your current expenses.
2) Focus on the inventory
It is essential to pay attention to your inventory as it can either make or break your business. Focus on the products that are standing out in the market and bringing you profit. Study your inventory well and you will have a clear idea on what products are not being sold. Liquidating your commodities is better than hoarding them.
3) Increase the payment options
Online payment can assist with increase in sales as it is the more convenient and accessible option for customers. The more range of transaction methods you provide, faster the payment. You can add options like credit cards, debit cards, internet banking, and UPI. Adding offers on various cards will also help you benefit your sale.
4) Constant updates on invoice
Invoice is the gateway to steady payment and you should be on the top of your game when it comes to invoice and payments. They should preferably be in bold letters and easy to read. Send reminders to your customers a few days before the payment is due or on the day of the payment. In case of late payments, you can always send a reminder by email or a call. To get the payment on time, you can even offer your customers a discount when they pay money in the first week of giving the invoice. Similarly, you can have a late payment penalty option. These rules can be mentioned in the terms and condition of the invoice for convenience.
Sustaining a business also means sustaining an overall outlook towards how you manage your business and how you plan to expand it. By following the simple steps above, you can sustain your business and take it to greater heights as well!