Keeping a steady and balanced cash flow running through your operations is essential for businesses of all sizes but particularly for small companies and startups. Here are 6 tips designed to help you find the right focus if you’re at the helm of a fledgling company in any sector.

1 – Be serious about sales

There is always a huge amount to consider if you’re starting a new business and you’re aiming to compete with established players in your market. But, however great your plans might look on paper, until you start generating sales then your business ideas will remain unproven and your cash flows could very easily dry up at any moment.

2 – Expect the unexpected

From the point of view of cash flows, expecting the unexpected means building some financial flexibility into your plans every step of the way. It can be very tempting as a startup business to plan on the basis of best case scenarios but a healthy dose of caution can ultimately make the difference between viability and failure.

3 – Measure all aspects of your finances

Finances reflect unavoidable and fundamental realities about a business and they should therefore be kept a seriously close eye on if you are looking to scale up a new company. Measuring your incomings and outgoings as comprehensively as possible can reveal details in the way your business is progressing that directors can make important use of in a variety of ways.

4 – Keep costs down wherever possible

Perhaps it goes without saying that keeping costs down can play a crucial role in maintaining cash flows at a healthy rate but it certainly bears emphasising in this context. Understanding where costs can be cut and ensuring that outgoings are not being squandered in any way can all too easily be overlooked and come back to haunt new businesses in early-stage development.

5 – Streamline the process of getting paid

Generating sales and securing profitable working relationships is the aim of the game as far as startups are concerned but it isn’t the end of the story until your invoices are paid and your revenues become a tangible reality. With this in mind, it’s always important to focus time and effort on the mechanisms through which your company receives the cash it succeeds in earning. Efficiency and expediency are the keys to it all and the more you minimise the impediments to your company being paid the healthier your cash flows are likely to be.

6 – Build relationships with suppliers

Building up strong working relationships with supplies can help new companies as they develop in a variety of ways but it can make a real difference if your startup business finds its cash flow pressures becoming a problem. In short, any trust or good standing you can gain with suppliers will help to give your business what might be vital flexibility during times of financial difficulty.

Cash flows could hardly be more crucial for companies big and small so hopefully the above tips come in useful as focus points if you’re striving to see your startup business settle into fully fledged small business status.

Conrad Ford is the founder of Funding Options, which provides a range of online tools to help firms and their trusted advisers to manage funding and cash flow. 

By Eddy

Eddy is the editorial columnist in Business Fundas, and oversees partner relationships. He posts articles of partners on various topics related to strategy, marketing, supply chain, technology management, social media, e-business, finance, economics and operations management. The articles posted are copyrighted under a Creative Commons unported license 4.0. To contact him, please direct your emails to [email protected].