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Solving Business Cash Flow Problems

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Solving business cash flow problems can seem like an impossible task when you are stuck in the middle of them.

Depending on how long you have been suffering the symptoms of poor cash flow it can take a while to recover from, but by doing all the following steps you will see an immediate positive change to your cash flow problems.

It has been a challenging year in a lot of areas and for a lot of Business’s but one thing which needs to be a key focus for your Business is Cash-flow.

Accurate Accounts
You need to have a solid set of management accounts for each of the previous 6 months or longer if performance during Covid19 is distorting the figures. This can take time to put together but it is essential. The key information that you should take from these reports is:

  • Are you making a profit or loss month to month?
  • Have sales been increasing or decreasing?
  • Have your operational costs been increasing or decreasing?
  • Do a stock take (if you sell a physical product)
  • Complete a cash flow forecast

Debtors and Creditors
The next important thing to do is to find out who owes you money and who you owe money to. Owing your suppliers too much money is a very serious situation because if they are a key supplier they can stop giving you product and that can stop your business. Equally important is who owes you money.

Customers and clients who owe you money usually got that way over a period of time. The key thing to do here is quickly figure out those who can pay, those who can’t pay but want to, and finally those who won’t pay.

If you’ve completed all of the tasks above then you now have all the necessary information to start making the changes that will begin solving business cash flow problems

Here are the key steps:

  • Are you making a profit or loss?
  • If you are making a profit month to month great
  • If not then you need to restructure costs so that you are profitable

Call all and meet the people who owe you money starting with those who owe you the most

  • A tip here is to offer a small discount (say 3%-5%) for immediate payment
  • The goal is to get your customers into a payment plan so that they are making some payment to the debt

Talk with your suppliers, call them and meet with them, especially your key suppliers

  • Show them your cash flow forecast, let them see how and when they can get paid. If they see that you are dealing with your cash flow problems and can see how they get paid then they will be more likely to work with you. The converse also applies that if you ignore them they can kill your business but putting you on stop.
  • Whatever payment plan you agree with them – stick to it!

These are the most important key steps that you must implement if you are serious about solving business cash flow problems. They can seem daunting, they can even seem terrifying but from our experience with our clients, once addressed you see immediate positive results to your cash flow problems.

Got some questions? Give us a call!

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Citywest Business Campus,
Dublin, D24 PPT3
Tel: (01) 901 1310


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O’Brien Road,
Co. Carlow, R93 YOY3
Tel: (059) 910 0440


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Mahon Industrial Estate
Cork, T12 K7CV
Tel: (021) 2021130

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