How to achieve a balance in the flow of money?
To be able to carry out a good flow of money in your small or medium business, you must find a strategy in which the handling of incoming and outgoing money becomes more balanced. On the one hand, trying to make your income not only constant but now climbing to see a high profit margin. And on the other, that your expenses can be reduced little by little or even eliminated. Well, this will be enough to improve the results in the financial performance of your company.
But before implementing various strategies that will allow you to obtain these results, you must begin with a complete analysis. That is, you have to evaluate all the different aspects that affect the income and expenses of your business. You can do this in a very simple way.
The 2 steps for the analysis of the flow of money:
# 1 Comparative list
Enter in a comparative list for a monthly period the income and expenses generated by your business until now. It includes the different channels from where you get income and all those concepts of expenses such as suppliers and basic services.
# 2 Identify better income and higher expenses
Within that same comparison, it manages to identify the invoices that have generated the highest revenues. It is good to know who your best customers are so that according to that, you can establish the strategies that will increase those money inflows. In the same way you should know what expenses are those that you could be reducing or even eliminating completely.
Strategies for balancing the flow of money
By having the above information, it is time for you to decide on a main objective in order to begin to establish strategies on balancing the flow of money in your business. For example, if you noticed that your expenses have been gradually increasing due to situations external to your business. That is, the costs of raw material or your suppliers have increased the sale price. So your main objective is to reduce operating expenses. While as a secondary goal it would always be to keep new income opportunities in mind.
Plan the strategy
When we talk about strategies for a business and its flow of money, there are many you can acquire from a financing to increase liquidity to invest for internal development and attract more and better customers. But the ideal or the ideals are those that go according to the previous analysis that you did.
As some ideas to obtain more income could be the following: open new sales channels, include technology that shorten the processes to raise production, invest in advertising or even create a new mix of products or services. On the side of the reduction of expenses you could: reduce the consumption of basic services, look for better suppliers, make alliances or reduce administrative costs.
Once you are implementing these strategies you will achieve the balance of the flow of money by maintaining a range of income that is above the expense. But you need to continually review the results of these strategies. Analyze again how much the figures have changed according to the previous months and if it goes on working continues like this. But if you do not see many results, you can make the necessary adjustments so that the strategies take the right path.
Digital tools that can help you
Today there are digital tools that can give you updated information and in real time on the income and expenses generated by your business. Kompás can help you this and in the same way to identify very easily the performance of your business. It also shows who your best customers are and what your biggest expenses are. In order that you can make better financial decisions about your small or medium business.
Now that you know some tips on how to start finding the balance of the flow of money in your business, you can begin to do what is necessary. We recommend that you always have in mind to give your company a boost so that it can grow exponentially.