Get Control Of The Money In Your Business.
Start Having Fun Again!
Using the money in your
business is a real challenge.
Several small business owners
have offered to share their secrets of how they have managed to stretch their
hard-earned cash with Make-Your-Small-Business-Grow.
Listed below are several
suggestions, hopefully you will be able to use them in your business.
14 Secrets On How To Stretch Your Money
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Negotiate extended payment terms from your major suppliers (pay invoices
within 45 or 90 days rather than 30 days).
-
Increase the cash in your business by taking all discounts from your suppliers for early payment on invoices. If they
don’t offer a discount program ask them for one. You will be surprised that up
to one-third will agree to do so.
-
If interest rates are low,
refinance your debt every 36 months. Many people feel uncomfortable doing a
re-finance, banks love it. Especially, if you have paid you current debts on
time.
-
“Factor” your receivables (especially if your gross profit will allow it).
Factoring is selling your receivables to a factoring company for cash now
against outstanding receivables.
Important Note: This is a rapid method for increasing money but don't do it too often.
-
Make your deposits on a daily basis. McGraw-Hill studied 2300 small businesses,
37% of these business held their checks for one or more weeks before depositing
them.
-
Charge a “late-fee” for late payments. This is a common
practice that many feel they will “offend” the customer. The reality is many
businesses accept this as a common, acceptable practice.
-
Create a gentle, nurturing system of follow-up on those who pay late. A
post-card reminder, a gentle telephone call, a letter asking if there was a
problem with the bill or the product or service, a second invoice with “overdue’
stamped on it.
-
Offer your own discount for early payment.
-
Send bills out daily. Seems like an obvious thing to do, most small
businesses wait to send bills out on a monthly basis or every two weeks. With
inexpensive computer software available today you can do it easily.
-
Whenever possible, pay bills immediately following the service or product
provided.
-
Sell slow-moving inventory
at cost. Be certain to “give-the-reasons-why” you are doing this so that you
don’t depress prices in the future
-
Lease equipment rather than purchase. Negotiate the terms of the lease as
strongly as possible.
-
Do not pay your bills early. Pay within the supplier’s terms unless you can
take an early payment discount.
-
Obtain your inventory on consignment
from your suppliers (based on sales agreements with customers). Show
them the contracts or agreements you have with your customers. This
will provide confidence to the supplier that you will sell the goods on
consignment.
Here are some additional
methods that readers of Make-Your-Small-Business Grow have offered to control
the money in their businesses.
How To Reduce Your
Expenses By 30% or more?
1.
How to get free furniture from your customers?
A computer
software supplier was expanding their business. One of their customers
were a large manufacture with several facilities in the area.
The owner of
the computer software company approached the manager of the manufacturer's
facilities. He simply "asked" if they had any office furniture they
had in storage and if they would be willing to sell it to him.
The facilities
manager was very happy to sell as much used furniture as the computer
software company could buy.
They purchased
all of the furniture for their expansion at 33% of what they would have paid
at full retail.
2.
How to find and negotiate vehicles for pennies on the dollar?
Many of the
major car rental companies are selling good used automobiles for 60% to 75%
of retail. If your business is credit-worthy you will be able to
finance either through the car rental companies or your bank.
One
additional source: if you have a good relationship with a
leasing company ask them to advise you if they have good, useable
automobiles that are at the end of their lease or repossessed.
3.
Trading and Bartering
Many professionals such as accountants, attorneys, engineers,
architectures are willing to trade the goods or services you provide for the
services they provide. This is legal and is referred to as
"compensation-in-kind". Ask the professionals that you use if they
have similar arrangements for their clients and would they consider such a
thing.
4.
How to reduce delivery and freight charges?
There are
several companies today that are using the services of a "freight logistics"
company. If your business uses a number of common carriers you may be
able to "hire" a freight logistics company to negotiate greater freight
discounts for your business.
The
freight-logistics company will invite all your common carriers to "bid" on a
contract (normally for a two year period). Since the common carrier is
bidding for your business you can expect significant improvements in
your freight discounts.
The
freight-logistics company is paid as a portion of the saving they generate
for you. Therefore your business pays less for shipments and there is
no (expense) money out of your business.
5. How to find the best
medical coverage and pay less?
Most Chambers
of Commerce offer healthcare, dental, eye-care, vision-care, life insurance
programs, etc. to their members.
While you will
be required to join the Chamber of Commerce the savings in insurance
premiums will probably more than off-set the cost of membership. They
are able to offer reduced premiums since they create a "group" of employers
among all the members of the Chamber.
6.
How to find telephone systems at reduced prices?
This is
somewhat amazing however, because the telephone business has become so
competitive there are independent hardware companies who are willing to sell
"used" telephone systems.
Typically, the
used systems are from companies who have decided to "up-grade" their current
telephone system.
If you are in
the market to replace or install a telephone system you should ask the local
telephone suppliers if they can quote a "used telephone" system to you.
You may be pleasantly surprised.
If you have found similar ways
of saving money for your business, share it with the readers of
Make-Your-Small-Business-Grow. There are 1000's of readers just like you
that would appreciate knowing how to manage the money in their business better.
Simply send an email to
help@make-your-small-business-grow.com with your methods of making or saving
money and we will include it in our next update. Thank you.
Many times you can keep more of the money you have by controlling and improving the business you already have, click here to find out how.
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