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6 Ways to Improve Business Cash Flow

Ways to Improve Your Business Cash Flow

With consumers and businesses alike buckling down on their spending during this topsy-turvy economic spell, focusing on efficient cash flow can help your organization survive troubled times.

Try these tips for converting products and services into cash. Know, though, that some of the suggested strategies might be at odds with one another; the idea is to choose and combine the specific tactics that work best for your business.

Sell more. Your business can increase its cash flow somewhat easily by bringing in more sales or by expanding a product or service line. Try hiring additional sales people or increasing your target market size.

Get paid promptly. Be sure payment schedules are met, and call customers promptly when they fall behind. Consider offering percentage discounts for early payments or setting your terms to be payment-in-full when products or services are delivered. For long-term projects, divide the fee into segments and request payment in advance of each new phase.

Shorten your days sales outstanding (DSO). A DSO analysis provides general information about the number of days on average that customers take to pay invoices. To figure DSO, divide total receivables by total credit sales for the period, then multiply by the number of days in the period. The lower the figure, the faster you’re getting paid. Keeping an eye on this number allows you to be proactive in collecting accounts on time.

Cut down on inventory. A sale is one way to quickly rid your business of inventory that is not moving – plus it frees up valuable space for other products that can sell better. Another option is to ask the distributor who sold you the product to buy it all back. You may be assessed an administrative fee to return product, but this tactic frees up capital and space.

Work with vendors. Always ask for longer payment terms and favor suppliers that offer them. Negotiate terms with your vendors for 30 days or more (instead of upon delivery) so you have an opportunity to complete the work, bill your customers and receive payments prior to paying your vendor.

Secure a line of credit. At times, borrowing the cash you need can help your business run smoothly. Often rates on a business line of credit are less than the late fees your vendors will charge. The line of credit can help you cover a lapse in cash flow for short periods of time. Just be sure not to borrow too much, and always have a plan in place to pay it back on time.

Seek Expert Help
Now more than ever, a keen eye on cash flow is vital for your business. The business bankers at MutualBank can suggest cash management strategies to help you further boost your cash flow. Call 800-382-8031 to schedule a customized planning session with your MutualBanker today. Go ahead...live a better life!

Contact a Representative Today

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Personal Banking Security Measures for the 21st Century

clientuploads/21st-Century-Securitysquare180.pngMany of us are constantly connected to the online world these days. This means that the potential is there for our computers and personal information to be compromised which greatly increases the risk of ID theft and financial fraud to occur. However, by taking some basic precautions you can significantly reduce the risk of your computing environment being compromised. Following these simple guidelines should help your computing environment become more secure:

Keep your computer and software up-to-date

Keep your computers and network equipment secured with the latest software updates and enable automatic updates whenever possible.  This includes updates to third party applications such as Java and Adobe Products.  

Use hard drive encryption

In the event your machine is lost or stolen, drive encryption can prevent others from accessing the data on your hard drive.  The purpose is to encrypt or scramble your data on your machine so that it can only be read with your encryption key.Many operating systems offer drive encryption.  Microsoft offers Bitlocker and Apple has FileVault. There are also other third party encryption offerings.   

Enable your firewall

Think of the firewall to your computer as the fence around your property.  If there were multiple holes cut in the fence, it wouldn’t be very useful at keeping people out.  Firewalls are typically enabled by default on Windows machines, but double check to make sure it’s on.  Here are instructions to do so if you are using Windows 7. Only allow necessary applications inbound access through your firewall. The same principles apply to your network firewall. 

Configure your screensaver

Set an auto-locking screensaver so your account gets locked out after a few minutes.  This is useful if you forget to lock your machine when are away from it. On Windows machines this can usually be done by pressing the “Windows Key” and the “L” button simultaneously.

Make your passwords stronger

The longer and more complex the password, the better.  At least 16 characters with a combination of upper and lowecase letters, numbers, and special characters is a best practice.

Configure your router

Use the strongest wireless security available (currently WPA2-CCMP) with a long and complex password for your wireless network. Disable WPS on your wireless router for greater security.   

 


Think that some secure banking information
of yours has been compromised?

If you suspect that your personal financial information has been compromised, call MutualBank Customer Support at 800-382-8031.


 

Monday, April 7, 2014

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6 Ways to Improve Business Cash Flow

Ways to Improve Your Business Cash Flow

With consumers and businesses alike buckling down on their spending during this topsy-turvy economic spell, focusing on efficient cash flow can help your organization survive troubled times.

Try these tips for converting products and services into cash. Know, though, that some of the suggested strategies might be at odds with one another; the idea is to choose and combine the specific tactics that work best for your business.

Sell more. Your business can increase its cash flow somewhat easily by bringing in more sales or by expanding a product or service line. Try hiring additional sales people or increasing your target market size.

Get paid promptly. Be sure payment schedules are met, and call customers promptly when they fall behind. Consider offering percentage discounts for early payments or setting your terms to be payment-in-full when products or services are delivered. For long-term projects, divide the fee into segments and request payment in advance of each new phase.

Shorten your days sales outstanding (DSO). A DSO analysis provides general information about the number of days on average that customers take to pay invoices. To figure DSO, divide total receivables by total credit sales for the period, then multiply by the number of days in the period. The lower the figure, the faster you’re getting paid. Keeping an eye on this number allows you to be proactive in collecting accounts on time.

Cut down on inventory. A sale is one way to quickly rid your business of inventory that is not moving – plus it frees up valuable space for other products that can sell better. Another option is to ask the distributor who sold you the product to buy it all back. You may be assessed an administrative fee to return product, but this tactic frees up capital and space.

Work with vendors. Always ask for longer payment terms and favor suppliers that offer them. Negotiate terms with your vendors for 30 days or more (instead of upon delivery) so you have an opportunity to complete the work, bill your customers and receive payments prior to paying your vendor.

Secure a line of credit. At times, borrowing the cash you need can help your business run smoothly. Often rates on a business line of credit are less than the late fees your vendors will charge. The line of credit can help you cover a lapse in cash flow for short periods of time. Just be sure not to borrow too much, and always have a plan in place to pay it back on time.

Seek Expert Help
Now more than ever, a keen eye on cash flow is vital for your business. The business bankers at MutualBank can suggest cash management strategies to help you further boost your cash flow. Call 800-382-8031 to schedule a customized planning session with your MutualBanker today. Go ahead...live a better life!

Contact a Representative Today

Back to Education Resources

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