THE Commonwealth Bank of Australia is urging small business owners to take stock of their finances and monitor cash flow as the usually busy summer period gets off to an unseasonably slow start. CBA executive general manager Symon Brewis-Weston said cash flow was one of the most common challenges faced by small-to-medium sized businesses, and that even profitable businesses could fail if cash flow wasn’t managed well. “Keeping a smooth cycle of cash flowing through your business will help ensure there is enough money coming in to cover the outgoings, and hopefully some surplus for profits,” he said. “When times are tight and input costs are rising, look at where you can speed up the cycle, either through cashing debtors, managing stock levels or reviewing your pricing.” Mr Brewis-Weston has 10 strategies to set SMEs on the right track over the Christmas period. He said while keeping track of cash was on top of the list, emptying stock levels, implementing an effective pricing strategy to drive profits and keeping the communication lines open with debtors were important for a small businesses to maximise cash flow. Business owners should also reassess staffing levels to ensure extra salaries over the holiday season were accounted for, encourage prompt payments from customers, keep cash in the bank for as long as possible, educate staff on the cash flow cycle, monitor spending, and maintain regular contact with banks.
