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3. Check your vendor payment terms
While you're trying to get paid, your accounts payable balance may be starting to climb. It's a good idea to know the details of your vendor payment terms. Which vendors can you delay paying without being hit with late fees? Slowing down your payments can keep cash in the bank longer to help you weather any cash flow crunches.
4. Manage your inventory process
If you sell physical products, you know that a significant amount of cash can be tied up in inventory. It's frustrating to see unsold products piling up while your bank account is dwindling. If you frequently find yourself in this position, it might be time to make changes to your inventory process. Your inventory management process should make it easy for you to see how much you have on hand, how long it's been there, and when you need to reorder. Consider adopting inventory management software, and explore whether just-in-time inventory management might work for your business.3
5. Stay lean
One of the best ways to better make it through cash flow struggles is to keep your costs low. By cutting unnecessary costs before you're in financial trouble, you'll be able to build up a cash reserve to cushion you through any down times.
To start, review your budget with a critical eye (don't have a formal budget? It's time to create one and this guide can help).4 Start by highlighting any expenses that aren't critical to running your business. With each one, decide whether it's something you want to keep or something you can cut. If you want to keep it, what are different options? Is there a cheaper alternative? Or can you negotiate a better deal? Small changes to your budget can add up to significant savings.
Don't let cash flow issues create problems for your business. Whether you're looking to improve your receivables process or have up-to-the-minute reporting on your bank balances to create better cash flow projections, Synovus can help.