Happy New Year!
Here we are 2015, hope it's a great one for all of you, especially after the last few years. It might be your fiscal year end, and with that the dreaded inventory count. This time of year cash flow is tight for a lot of businesses and customers alike. The following are some suggestions to help stimulate your cash flow immediately.
Do you have excessive cash tied up in ageing inventory? If your business is retail and the end of year coincides with your fiscal year end; do you perform an inventory count?
What were the results? Did you discover a lot of aging inventory that you should move?
Any reason is a good reason for an event or sale. That inventory is your cash being tied up. We've said it before and we'll say it again “Look hard at your ageing inventory” If you've counted it several times now would be a great time to discount it and get some of your cash back.
Do some of your suppliers have a policy where you are able to return some of your items in exchange for new product or a credit? Some companies have an agreement with their suppliers which enable them to return a certain percentage of products annually. (There might be a restocking fee) It might still be worth looking at to change the direction of your company.
Ask some of your key suppliers if they would consider exchanging some product.
Do you have company vehicles or equipment sitting stagnant?
You can have a tremendous amount of capital tied up in vehicles and insurance.
Speaking of Insurance. Have you reviewed any insurance policies you might have in place, buildings, equipment etc. to ensure that they are up to date and provide sufficient coverage? Consider asking for a 2nd quote from another insurance provider making sure you are looking at comparable policies. You might have a great repor with your provider, but at the end of the day, they're in business to make money. Don't assume that because you've been dealing with them for years, that they have your best financial interest at heart.
Analyse your cell phone usage and plans.
Do you employ a cleaning service or can some of the staff take turns cleaning certain areas on a rotation?
Are there things in your operation that could be more financially effective to outsource?
Are there task that you are currently outsourcing that you could be doing internally?
Sometimes a new staff member has hidden talents.
This can be a touchy emotional subject for some...review your staffing requirements.
Two people with lots of productive things to do, is better than 3 people with not enough to do.
So let us get this straight, you possibly give your loyal repeat customers a discount, AND you give them 30 day terms plus the cost of administration, which invariably they are late on.
Stop the madness!
As an example: We had the opportunity to do some work for a small business that was doing approx. $500000 a year in retail and consistently carrying $60000 in Accounts Receivable, a lot of that over 120 days. This was their money!
If at all possible don't have accounts (you are not a bank), unless you are a bank...
Some of you are going to disagree with this and say that your customers are used to A/R's, they like it, they won't deal with you. Of course you know your customers best but we think you'll find the customers who protest the loudest are also the ones asking for the deals, always returning things, and consume the most amount of your time. Just food for thought.
Ask "Can we put it on Visa or MasterCard?” we realize there is a cost but you're losing that and more when accounts go past 120 days anyway.
For those customers who absolutely must have accounts offer a discount for early payment. Get their credit card number to have on file and automatically with their written authorization (updated annually) run it through on a consistent date at the end of the month.
Get prepayment for special orders. You invariably order widget "A", it comes in, you contact the customer and they say they don't require it anymore, bought one elsewhere, etc. It's something you normally don't stock, you want to return it to your supplier and you’re charged a restocking fee, or worse they won't take it back at all. It then becomes your cash tied up in something you didn't even want. Prepayment in advance addresses this. This goes for your employees too.
This post is not about gaining popularity, it's about taking control of your money and your business...Don't forget, smile, have fun, instigate some changes and make some money.
“More often than not, things and people are as they appear” Malcolm Forbes
And just to be contradictory:
You don't want anything you can control standing in the way of your business succeeding:
Be positive, on time and attentive.
Smile & relax
If you cringed when you read some of these points, you need to walk into your business with an objective eye and revamp these FREE (or almost) things you can do to improve the positive impression you are making on your customers and possibly your bottom line.
We have all heard the phrase “You don’t get a second chance to make a first impression”
What does their first impression tell your customer about your business?
How do you start your workday? Do you put your key in the door, turn the lights on, get the coffee going or are you truly proactive? Do you get your emails out of the way? Are your suppliers in a different time zone, can you contact them before the day get's going?
Consider asking yourself the following:
Managing time is essentially managing your priorities. To achieve effective time management you must think about what you actually need to do and be realistic about giving yourself enough time to do it.
I have put together some points to help carve out some time for the things that you love.
When are you most efficient?: My husband and I work on opposite ends of the spectrum. After 3:00 don't schedule an important meeting with him. For me, I'm just getting into my stride, bring it on. Work your most important tasks when you're most alert and working at your peak.
Line your day up just 15 to 30 minutes early: Give yourself a head start to deal with your emails, shuffle your leftover paperwork from the day before, to get your phone calls to your suppliers done before you open the doors.
Create a list: Things that you want to achieve that day or week. I use Google Keep , a super easy, free note taking check-list program that you can also use on your phone. Tick them off as you go, it gives you a feeling of accomplishment. Colourize the notes by importance or subject, e.g. Green customer requests, Yellow family requests etc. If you're old school, keep a note pad and pen with you to jot things down before you forget them.
This one's going to hurt! But you might find 2 hours of totally quiet uninterrupted time (possibly on a morning of your day off) might get a weeks worth of company maintenance done in a couple of hours.
It's not going to reduce the time spent working, but it's definitely going to reduce your stress.
Block out time: This will hold you accountable and help you avoid procrastinating. You'll find that the free timer countdown program e.ggtimer.com is very helpful in not letting the time get away on you. (Especially when on the computer) Because you know it's running in the background you tend to work more efficiently.
Prioritize and learn when to say “No.”: You only have so much time and you can only be at so many events. Choose the ones that benefit you, your family and your business.
Harness technology: Embrace it to make your job easier.
Set boundaries: Have reps make appointments for meetings. Ask them to email you an agenda in advance. What do they want to go over? Is it booking season? Are they showing new product? Are you being rewarded with a cruise for being their best customer? Then you are prepared in advance for the meeting and you don't waste time listening to the rep to explain why they're there. They shouldn't just blow in the door and expect you to drop everything. Don't confuse being overwhelmed and busy with being productive.
Get off Facebook, Pinterest: Pick a certain time of day to deal with these or you will have no day left. Again e.ggtimer.com. or give me a call.
Speaking of Pinterest, I have attached my board of free digital tools that I'll always updating.
See what ones work for you.
Handle things once: Handle things one at a time, multi-tasking sometimes just looks like busyness not productivity. Deal with it or conclude it while it's in your hands.
Be kind to yourself: Try a few of these things to organize your time and you could find that you are spending the time you need to move your business forward.
Throw some ideas my way on how you managing your priorities and time.
Smiles from TLC
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