Struggling with your cashflow? Here are our top tips

Maintaining a healthy cashflow sometimes feels like a big headache, especially with the ongoing cost of living crisis hiking your costs.

Even profitable businesses can fall down if they don’t know how to effectively manage their finances and adapt to challenges.

So, to help you stay afloat despite the turning tides, our experts have outlined their top tips:

Take care of your balance sheet

Your balance sheet will be able to tell you all you need to know about your business’s finances, beyond your current profits and losses.

By having the ‘net worth’ of your business readily available, your balance sheet can quickly give a good indicator of its current performance whilst alerting you of any potential concerns about the cash you have available.

This can also inform you of how strong your business’s finances are, and give an insight into how resilient it will be to economic shocks.

Shorten your Cash Conversion Cycle

Depending on your current position, you may be worried about how your business will either improve or maintain its current cashflow when faced with the upcoming recession.

To keep on top of this, consider how long your Cash Conversion Cycle is.

This will tell how long it takes for cash to go from your customers’ pockets to your accounts.

In essence, it covers the time scale of buying stock from your supplier, paying the supplier for that stock, to then selling to your customers, and receiving the payment from them.

Of course, your aim should be to keep this cycle as short as possible, as this will free up the cash to use for any extra support you may need.

If there is a long wait between selling products to your customers and receiving the payment, consider altering your payment systems.

Introducing more regular communication with debtors and ensuring there is a clear deadline for payments can deter late payments.

Another option is to introduce fines for late payments, but this could jeopardise your client relationships.

There may also be scope to revisit your payment plans with suppliers and decrease the length of time between you paying them and receiving payment from customers. Negotiating these terms will make sure both parties come to a fair agreement.

For advice on improving your business’s cashflow, contact our team today.

Business right caret

Small business confidence dips ahead of new customs controls coming into force

Four in 10 exporters have reported a fall in international sales since the end of the Brexit transition period, a major study has revealed. According to the tracker, four in 10 – around 41 per cent of traders – have reported a “drop off” in international sales in the three months to September 2021.


Large number of businesses looking to recruit more staff

It is perhaps a sign of confidence returning to the UK economy that a significant number of British businesses believe they will be recruiting staff over the coming year.


Spring Statement 2022 summary

Mr Sunak found himself addressing MPs against a background of crisis, with the residual impact of COVID, the invasion of Ukraine and the cost-of-living crisis all affecting the economy in different ways.


Compliance right caret

HMRC asks sole traders to correctly report SEISS grants or “repay in full”

Sole traders who have not correctly reported their Self Employment Income Support Scheme (SEISS) grants may be forced to repay them in full, it has been warned.


Making Tax Digital – what you need to know ahead of 2022-23

From April 2022 all VAT-registered businesses need to comply with MTD for VAT. MTD applies to taxpayers who file Income Tax Self Assessments for business or property income of more than £10,000


Real-time online sanctions tracker to assist importers and exporters

Any business involved in international trade, whether importing, exporting or part of the supply chain supply to those firms, is faced with a rapidly changing regulatory environment.


Economy right caret

Small businesses call for Government support to tackle climate change

According to new research, many are addressing energy usage, increasing recycling and investing in microgeneration, but only a third of those have a formal plan to tackle climate change within their business.


Hospitality bosses develop new strategies to cope with staff shortages

Hospitality business owners have responded positively to the staff shortages caused by the pandemic, by increasing wages and implementing improved staff retention strategies.


Everything you need to know about the new WTO Services Domestic Regulation

New World Trade Organisation (WTO) rules are set to cut the cost of global trade by billions of pounds every year, it has been announced.


Tax Planning right caret

Almost 800,000 tax scams reported to HMRC in past 12 months, figures reveal

Nearly 800,000 tax-related scams were reported to HM Revenue & Customs (HMRC) in the past 12 months, a major study has revealed. According to the report, HMRC responded to 797,010 referrals of suspicious contact from the public in the last year. Around 358,000 of these involved scams where taxpayers were offered bogus tax rebates.

Tax Planning

Be aware of tax liabilities if you are using cryptocurrencies

For those who have dabbled in the market, its important for them to understand that there may be tax liabilities with Captial Gains Tax and Income Tax, with any transactions whether with currency or other crypto assets.

Tax Planning

Did you use a Bounce Back Loan to cover personal expenses during the pandemic? Act now to avoid tax consequences

If you received a Bounce Back Loan (BBL) during the coronavirus pandemic and took the cash as drawings, there may be additional tax consequences.

Tax Planning