Wednesday, 26 April 2017

5 Ways to Help Your Small Business When You’re Cash-Strapped

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 Well, no news here! Everyone gets broke sometimes, so are businesses. What counts is being able to find a quick way out of it when it happens. Experience has shown that the times when you need money the most are usually the times when it’s hardest to get. What to do? When your business is hemorrhaging money, you are running a very big risk. Finding a quick solution is what brings out the real business person in you. When your business is cash-strapped, you can do any of or a combination of the following.

  

01. Take a loan. Well, all you want is cash to keep your business running. Getting cash even at a cost is same thing as getting a loan to fund your business. Even though a loan may not necessarily fix all your problems, but it sure can help you out of a short-term cash crunch. How and where you can get it is largely determined by the cost of funds from the lender.

02. Cut your expenses. A very natural thing to do when cash-strapped! This step is absolutely the most critical. You must find and block any cash leakages to stop your business from bleeding cash. Even when the bleeding is not very obvious, you can still cut back on certain expenses which will not do damage to the business. However in doing so, you must try to be creative because if you can’t manage to get your expenses under control, then you’re going to be perpetually short of money.

03. Go liquid. That is, you must find a way to generate more cash. If you can do this creatively, it is much better than taking a loan. It helps if you can create a special offering, whether it’s a discount or a new premium package and get your clients to buy in. Going hard on your debtors to get them to pay up their debts can also help to raise needed cash.

04. Dispose of some assets. Yeah, disposing idle assets is one very viable way to raise cash. Sometimes, you may have in your stores, assets you acquired in the past you have not really used or some fairly used ones you have rested. You can dispose of these assets just like as in garage sales to raise cash.

05. Run your business profitably. It is difficult to get cash-strapped if you habitually run your business profitably. A profit mindset draws out the strictest money-management practices in any business. Putting profit first and setting aside a predetermined percentage of profit from every single bit of revenue will help you trim expenses and ensure your business remains financially solvent. That is one very sound management theory and practice which your business badly needs for survival.

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