Old Bay Insurance Agency Blog
One of the struggles of businesses on a daily basis is its cash flow, whether it is a small or big enterprise. When it is not managed well, it can have a bigger repercussion than a simple error can cause. Thankfully, businesses that have gone through these circumstances have learned from past mistakes.
They left certain points to help others avoid these conditions. It does not take a genius to be successful, but to learn from others can take you a long way.
Do Not Force Growth
Typically, small businesses are more eager for growth than the larger ones because the name should be introduced to the market. It means marketing, advertising, and other forms of promotion to generate income.
It will affect the cash flow when the company starts boosting posts on social media and paying for excessive promotion. Some businesses get enough likes but never enough sales to cover up the money it splurges for advertising.
Some industry has their peak seasons depending on the nature of the business. It can also be for those companies who do not have year long operations. It is imperative to keep this in mind and put in the financial plan. During the off-season, the company should strategize well on how to keep the sales with some discounts and offers.
It can affect the cash flow, so business should have ample amount to cover some expenses during depletion of revenue.
No to Overdue Amounts and Late Payments
Late payments always incur interests and charges, and it is not a good record to your cash flow. Even though these dues are small, if not taken care of may have a high impact on your finances in the long run. It also includes overdue invoices from customers. Your business also has vendors and contractors you need to pay. If you don't collect payments from your customers, you might run out of cash for this.
Whether you like it or not, taxes are mandatory and must be paid when it is due. It is also essential that the computation of your taxes in the business is accurate to avoid penalties. These penalties will affect your business’ credibility and worse, these penalties may accumulate interests.
Additionally, keep in mind that there are unexpected audits that may cause a bad image if your financial records are inaccurate. It is vital for the business to abide by the law all the time.
It is one thing to focus on how you manage your business, but also remember to protect the company itself with business insurance. At Old Bay Insurance Agency, we aim to make our client's life easier with policies that are tailored to their needs. You can get more information about our products and services by calling our agency at (410) 777-5390. Get your free quote today by CLICKING HERE.