If you are a service-based business then being tough on your payment terms is an essential part of boosting cash flow and balancing those business accounts on a monthly basis. Late payments inevitably cause countless problems for companies, especially small or start-up businesses that need all the capital they can get. Before you agree to a project, always ensure your client understands the payment terms of the transaction and be stern when chasing payments. Only a few circumstances can justify pushing your payment due date to its limit so stick to your guns to breed a client base of reliable payers.

As many business owners know the hassle of chasing payment can be a real nightmare, but whilst late payers should be managed effectively to reduce the negative effect on your profit margin, reliable clients who pay on time should also be rewarded. Create incentives for people who pay early and honour them.


Increasing your methods of payment can also improve cash flow, whilst many customers prefer to pay in cash, many more rely on plastic to complete transactions. Be sure to offer credit and debit card facilities both online and in-store. Making it easier for your customers to pay can mean the difference between getting paid on time and missing payment completely. The same applies for invoicing, make your invoice system as seamless as possible to keep the transaction uncomplicated.

Knowing how to handle and account for stock is also important when running a business after all stock sitting in storage is essentially tied-up profit. Manage your stock effectively by keeping tabs on daily sales and track the bestselling items in your inventory. Reorder and restock these best sellers to drive your business to new profit heights.

When handling your business finance, companies big and small can struggle with the ins and outs of cash management so our golden rule for enhancing cash flow is to seek expert help if you are struggling. Get to grips with keeping your books in order and chart company outgoings as efficiently as possible with a little help from an accounting professional to ensure your business stays in the black.

My name is Rob Hurren and I run an Accountants in Newcastle Upon Tyne.