Strategies to Improve your Cash Flow in 2023

If you want to grow your business during the new year, you should have control of your expenses just as much as your sales. The key to growing a business relies on effectively managing financial resources. Read on for strategies to increase cash inflows and limit cash outflows.

Expand to new markets 

An alternative to increase your positive cash flow is to identify new sources of income. Get the dream team together, and target new audiences to expand your sales market. One good idea could be adding a new service or product to your business portfolio to motivate existing clients to spend more and bring new clients to increase overall sales. 

Reevaluate Operating Expenses

Managing financial resources isn’t just about increasing your business income. It’s also relevant to reduce unnecessary expenses as much as possible. Take a careful look at your cash flow statement and analyze your company’s business expenses, then cut out any unnecessary expenses and try to minimize the necessary ones as much as possible.

For more information, review the following blog about How to Expand Your Business Globally

Establish Strategic Payment Terms

Be strategic about when you pay your vendors. If your vendor offers a discount for paying early, be sure to pay in the required time to save some money. If the vendor doesn’t offer a discount, pay when it’s most favorable for your business.

Another key to optimizing your cash flow is getting your customers to pay their invoices on time. We know this is easier said than done, but there are plenty of practical strategies to increase the likelihood of getting your invoices paid faster. One strategy we always suggest is to consider invoice factoring, which consists of selling your unpaid invoices to a company in exchange for immediate cash. The factoring company takes a small cut of the money you earn, but the payoff is that you aren’t stuck waiting on customers.

Some additional benefits of invoice factoring include the following: 

  • Domestic and international A/R financing; your debtors can be anywhere in the world.
  • Receive up to 90% of the value of each invoice.
  • Non-recourse: the factoring company assumes the risk of collection and payment default.
  • No need for collateral, asset appraisals, or financial covenants.
  • No prepayment penalties.
  • Does not put your assets at risk or require you to give up equity in your company.
  • Can be adjusted up or down according to your needs.

For more details on our international factoring services as an alternative to improve your business cash flow, review our latest blog about international factoring or contact our team of experts at [email protected]