1 Organize your billing schedule – bookkeepers first task
The faster your receivables to move, the more capital you can apply in the growth of your business and that is exactly what a bookkeeper will help you do. To help you control the early and frequent sales, put the billing schedule in an accounting program of your own. There are programs that can automatically classify accounts receivable by maturity – less than 30 days, between 30 and 59 days, between 60 and 90 days, etc. This kind of automated flagging system allows you to take immediate action when overdue accounts.
2 Extend your payables
Get the maximum amount of time allotted (often 60 to 90 days) to pay your suppliers. Think of these conditions as a line of credit from your supplier without interest. So you will have enough time to get resources without spending money on short term credit lines.
3 Take advantage of early payment
If your suppliers offer discount for early payment (usually two weeks after receipt of the invoice), enjoy. Think of it this way: if the money was invested, 2% discount for a 30-day invoice is equal to an annual return of 24%. If your suppliers do not offer this kind of incentive, ask yourself; they may be willing to offer the discount in order to accelerate their credit.Bookkeepers Melbourne just know what to help you with!
Balance your client base
Many professionals and service companies – such as advertising agencies or public relations, accountants, lawyers, real estate management firms, etc. – Work with certain clients on a project by project basis. Explore alternatives to transform some of these customers in a relationship of loyalty, where they pay a fixed monthly amount for a certain number of services. You may want to offer some kind of incentive – value-added services, a discount – to encourage them to exchange a product and / or service. This could reduce your profit margin, but will assist in developing a more predictable cash flow.
Check your pricing
Their prices are accompanying the increase in costs? When was the last time you raised prices? Many small businesses are reluctant to raise prices for fear of losing customers. However, customers expect their suppliers to adopt moderate and regular price increase policies. Also, make sure that the competitors’ prices are based on sound values. If they’re charging higher prices, accompany them. Your bookkeeper understands this and will shift his techniques accordingly.read more info about accountant responsibilities for bookkeeping by clicking here
Do not buy all in one place
You can save money by dividing their business between multiple vendors. Closely examine where you need to pay for added service and where you can save money by paying commodity prices. For example, you might want to buy your computer from a value-added reseller who can help you choose the right system to meet your business needs, although you can purchase other items – such as printer cartridges, cables or software ready to use – a sales catalog by mail or another store. To make sure that you are paying competitive rates, compare standard office equipment prices (such as computers, printer supplies, or postage) on the Internet.
Form a buying cooperative
Save money on supplies gathering some friends and buying materials such as floppy disks, printer paper in bulk and then dividing these materials among you. The bookkeepers Melbourne have the perfect help for you.
Renegotiate your insurance and supplier policies
You are getting the best possible deal on insurance, phone service, and other regular business expenses? Annually review each of your insurance policies and request three quotes from each, to make sure that it is better to invest your money. Look closely at the services susceptible to price as the company used for long distance calls and the Internet access service. Regularly examine these bills and do some research to make sure you are getting the lowest rate available.
Optimize your stock
The excess inventory can tie up significant amounts of money. Regularly evaluate the working of its stock to make sure that is within industry standards. read more information about managing your inventory at http://smallbusiness.chron.com/top-ten-ways-manage-inventory-11099.html. You can do this by calculating your inventory turnover ratio (cost of goods sales divided by average inventory value). Avoid buying more than necessary, especially when suppliers try to lure you with big discounts; this can tie your money. Periodically check your inventory in old or offline materials and postpone future orders. Use this material or sell it at cost to improve liquidity. Talk to a Bookkeeper Melbourne and have the right help now!