Stretching your cash reserves – top tips
Here we’ll quickly go through some top tips on managing your cash and making it last longer – especially important at a time like this.
Get paid quicker:
Sounds simple, but it’s not always that easy!
- Make sure you send out your sales invoices as soon as you’ve done the work (might sound obvious, but even I found some Feb invoices hadn’t yet been raised and sent)
- Have a system that lets you keep a note of work done and invoices you need to send (perhaps create a draft invoice – with rough details – in Xero as soon as you start the work)
- Xero projects could be a useful one here, if you really struggle keeping on top of project work
- Monitor Xero regularly for these draft invoices and even to make sure invoices are marked as sent
- Make it easy for people to pay you. See this page for more detail, but in short:
- Set up direct debits (GoCardless) with auto payment or enabling you to set up your own time to pay (instalment) options
- Allow credit card payments (Stripe or PayPal)
- Regularly check in on Xero, phone and email debtors more frequently than you have in the past
- Invoice larger projects in stages – end of every month or end of every week
Pay money out sensibly:
- Put off paying your tax bills
- VAT is automatically deferred (anything due between now and 30 June 2020)
- Self Assessment payments on account are also not payable 31 July 2020 (deferred until 31 January 2021)
- Corporation Tax & PAYE can have Time to Pay plans set up – but they have to be applied for (Details Here)
- Apply for mortgage or rent holidays (business and personal)
- Can you get payment holidays on your other loans / financing
- Ask suppliers for installment plans on large, one off invoices
- Can you pause operating leases or HP agreements
- Can you cut any unnecessary expenditure
Can you generate income in a new way (if established sources of income are drying up)?:
- Take away and delivery services for cafes, restaurants and other food manufacturers
- Wholesalers switching from business to business sales to direct sales with the end consumer. Setting up mail order and developing your online shop (Shopify makes this really easy, if you don’t already have an e-commerce site)
- Can you put online courses together to attract new followers, or even charge for content (Zoom lets you charge for attendees to join webinars)
- Can you sell vouchers for future sales / bookings?
- Work on your social media pages – if you’re like me, these don’t get much attention normally!
Ensure you know what grants you might be eligible for
Read our other pages and FAQs. Or give us a call