The cash flow in a business is like a tide. It rises and falls over time, often to predictable seasonal patterns that most owners can learn to read and prepare for. Sometimes, something goes wrong or additional sudden costs cause that cash flow to recede and to get stopped almost entirely. For an unprepared business, this can be a most desperate event. What can a business owner do to unblock that cash flow once more get the money they need when their business needs it most?
Use what you got
First of all, look at the value and the money you might have tied up in unexpected places in the business. If you have more office space than you need, you could end up leasing some of it out to another small business owner or a freelancer. If you have valuable equipment of any kind, it could be the source of a sudden cash injection, too. Whether it’s computer tech, machinery, vehicles, or heavy equipment, financing services like Equify can offer you low-cost loans on them. While it’s not free money, it can be a line of reasonable credit to use when your cash flow needs that extra injection, so long as you can pay it back when you’re back on top of the business.
Get rid of what you got
If it can’t be used to help you in your current situation and it’s not systems critical, then it might be time to consider whether or not you really need it in your business. Though your equipment might be some of the most valuable assets in the business, if they’re more of a cost than a benefit in the end, then reselling them might actually help you make the business more efficient. Unfortunately, there comes a time when you have to think about whether or not this might apply to people in the business, too. When the ship is in real danger of sinking, it’s time to think about trimming some of the fat or else it will drag you down with it.
Get what you don’t got
Are you running one of the businesses that rely on the payment for services and goods rendered after the fact? Do you invoice your clients or customers? If so, failing to ensure that collections are done in a timely manner could be one of the reasons you’ve been stuck in this situation in the first place. Software like Due makes it a lot easier to keep up-to-date with invoices and to make sure that the reality of how much cash you have in the bank or safe reflects how much you actually should have. Right now, however, it’s time to collect. Pore over past transaction records and identify any outstanding bills you’ve let slip by the wayside.
Above all else, remember that the money your business needs doesn’t come for free. It’s from the assets you use, the costs you can cut, and the money you’re owed. We might be able to free up more cash than we imagine in our business, but we can’t summon it out of nowhere.