Here are some more of our best tips on how to improve cash flow for your small business in Canada.
Professional accountants are often tasked with improving cash flow and proposing company strategies to boost cash flow for the business. Of course, the right answer always depends on each business’ unique situation. Having a diverse repertoire of cash flow techniques is the best approach to this situation every time. Here are a few things you can try:
- Update your prices for recent market conditions
- Mark up popular colors, designs, or packages
- Sell add-ons, warranties, or customization
Increasing the prices and volume of each order can steadily increase your cash flow by that increased margin. Start by checking current competitive market prices. Bumping up your prices may still keep you in the competitive pricing range. You can balance this as a nearly invisible slight increase across the board, marking up certain high-demand and luxury variations of items, or selling add-ons at a premium compared to the cost to provide things like warranties, custom engraving, or bundled add-ons.
Expand your sales market
- Market to a broader audience
- Re-engage previous customers
- Add new services or products
- Release new colors, styles, and packages for new audiences
- Partner and cross-promote with other brands
- Put your infrastructure to use (ex: rent the lawn/garage/greenhouse as event space)
- Create a referral program
- Enhance sales and customer service channels
The broader your audience, the more leads become conversions and paying customers. Consider marketing to a broader audience and offering wider or differently palette selections of products to appeal to a wider audience. Dark and light themes, the rainbow variety, or birthstone selections are all easy ways to brand your current inventory for new audiences.
You might market your B2B service to new niches, or even partner with other complementary brands like caterers and florists or roofers and landscapers.
You can also put your infrastructure to use. Host events in your largest space, open your commercial kitchen for classes or catering, or rent out empty warehouse space.
Reevaluate operating expenses
- Reduce overhead
- More efficient equipment
- Cut unnecessary, redundant, and legacy expenses
- Downsize/hybridize the workplace
- Audit your B2B service subscriptions
- Hire and promote internally with employee development
There are always places where you can reduce or optimize your operating expenses. Look for opportunities to cut expenses that are no longer necessary or relevant, switch to more affordable and well-suited services and software subscriptions, and where you can increase operational efficiency. If you cause the system to perform better at the same or similar cost, this can also increase cashflow.
When looking at your teams, look for ways to develop to promote and hire internally. Save on hiring and onboarding costs while making effective plans to fill all your roles.
Talk to your vendors & suppliers
- Renegotiate supplier and vendor contracts
- Re-evaluate your supplier/vendor marketplace
- Diversify for a more robust and cost-effective supplier network
Next, re-evaluate your vendor and supplier contracts. It may be time to check market prices and renegotiate your annual contract. Fortunately, one of the best strategies is to simply diversify your vendors so that you have more robust business continuity if there is an interruption in the supply chain of one or more vendors.
Every business situation is different, but you’re sure to find at least one way to increase your company’s cash flow in these strategies. Contact us today for more pro insights into professional accounting and operations.
Trust the Experts
IDM Accounting is passionate about supporting those in need through their financial success journey. We allow individuals and businesses the opportunity to focus on what’s important to them, while we worry about your financial health.
When you’re ready to take the next steps, consider a free financial health check! Contact IDM accounting to get started.