Accounting For Small Business- Tips for Healthy Cash Flow Management
                     Accounting For Small Business- Tips for Healthy Cash Flow 
Management 
 
 
At Outsourced Bookkeeping, we perform regular audits and suggest 
optimization to our clients to help them achieve their cash flow 
goals. In this blog, we identify and list our top 5 tips that 
have resulted in positive cash flow for the majority of our 
clients. 5 Tips for Healthy Cash Flow Management: Invoice swiftly 
to reduce DSO (Day Sales Outstanding): The most common mistake 
small and medium businesses make is to wait until a pre-set 
amount of time to send an invoice which delays the payment. The 
faster you send an invoice more time it gives you vendor to send 
the payment and quicker the payment ball rolls. 
 - Having an accounting software will helps a lot in this regard 
by giving you access to quick invoice templates. 
- Simplify and ease the payment methods, offer discounts for 
early payments. Every step you take to increase the payment speed 
contributes to more cash at hand and a healthy cash flow. 
Accounting software accelerates this invoicing by cutting and 
avoiding errors down the risks that manual bookkeeping manifest. 
If you can not invest in accounting automation software you can 
also seek help from remote accounting firms that offer outsourced 
accounting and booking services. financial accounting 
outsourcing. 
2. Give a little stretch to your payables: While you actively see 
early payments, spreading your outgoing money in a manner that 
works for your cash flow goals can be a useful strategy too. This 
avoids a sudden outflow of cash and gives you some room to plan 
out your finances. So considering taking as long as possible to 
clear your payments without pushing the payment deadlines and 
incurring late charges. Always ensure you don't strain your 
vendor relationships and damage your credit in the process. For 
clients who wish to stretch their payable, our accounting experts 
at Outsourced Bookkeeping suggest two common ways: 
 
Image:-  finance and accounting outsourcing - Narith Business Service 
1. Negotiate new due dates with vendors based on your 
convenience. 
2. Consider revaluating your payment agreements after diligently 
zeroing on your payment and due date requirements. 
Analyzing your inventory also take a hard look at surplus 
inventory that is not selling well and need to be discarded to 
release the cash struck in inventory. Consider choosing an 
inventory management system that is integrated into accounting 
software to give you a real time view of inventory at hand and 
measure to be taken. 
Reassess operating expenses: While delaying the payables is good 
strategy to control cash flow, reducing the expenses is even 
better way to improve cash at hand. Outsources to freelancers or 
third part service providers while staying true to your core 
product or service offering is viable option for most businesses. 
Even businesses and CPA firms outsource bookkeeping and 
accounting services to cut costs while improve their scope of 
services. Outsource financial accounting services. 
 Create a cash flow forecasting model: The most underrated 
optimization any business can make to enhance their cash flow is 
to build an accurate cash flow projection that can help you 
identify the problems before they originate. Cash flow 
forecasting is the process of estimating the cash outflow and 
cash inflow for a business over a period of time. Accurate cash 
projection predicts that cash position and gives you a peek into 
potential cash shortages to help you take necessary measures for 
course correction efficiently. However building an accurate cash 
forecast is not easy.