4 tips to improve cash flow during the pandemic

 Everybody is reeling from the effect of the COVID-19 pandemic. All businesses are facing the heat irrespective of the nature of their business. In such a situation, having a substantial cash flow can help your business stay afloat. But there are many reasons due to which a business may not have enough cash flow like, clients not paying timely and too many expenses.

But it is more important than now that you have a good cash flow and work on increasing it as well. Here are some tips that will help you improve your cash flow even during a pandemic.

1. Take deposits or advance

Since the pandemic is over-turning the finances of businesses, it is smart to take an advance. Whoever you are working with or will be working with in the future, make sure they give you a deposit. It helps you start work as you have enough cash to do so. Also, it ensures that you have some payment for the goods that you will be delivering.

If a client is unable to give a deposit upfront, ask them to show you their financial sheet, which can assure you of their timely payment. But in this pandemic, taking a deposit is a better option.

2. Work with your debtors

If you have clients who have not paid for long, this is a good time to get them to pay. If they are financially strong, and are paying or buying things, they are in a condition to pay you as well. So, send reminders daily and make sure they know that you can hire a debt collector in NYC if needed.

Give some time to debtors who are struggling with their finances as the pandemic will make it worse. But if you are in debt, try collecting with the situation in mind. Maybe you can forego the interest rate, or you can give them a payment plan or so on.

Work with your collection agency to find a balance that can help you both.

3. Hold onto your taxes and rents

A lot of governments have come up with relaxation on taxation and rent-paying. If your business is struggling, you should not pay some amount right now. You can hold paying the taxes or rent or lease of the building you work in if you have other urgent matters to attend to.

You will have to pay them later, but till then you can work on improving your cash flow. Also, with the money you saved, you can do other things which can enhance the revenue.

4. Find ways to improve your revenue

Increasing your revenue is the best way to improve the cash flow of the business. That is difficult given the pandemic. But here are some ideas:

• If your product is something that people need more during this time, you can increase your revenue. Do it by offering discounts, home delivery, and more.
• Try something different, like Amazon continued home delivery of groceries during the lockdown in India, while the rest of the products were on hold. A lot of food-delivery apps did the same, giving them business.
• Try to sell an okay product with a good quality product.
• Ask your loyal customers to promote you.

The times are stressful, but you can overcome this challenge with these tips.