How to Generate Positive Cash Flow

How to Generate Positive Cash Flow

You own a business, and as such, one of the major the points of having that business is of course to generate cash flow. What we mean here by cash flow is quite simply, that amount of money coming into the company after expenses. Without any cash flow, you only stand to struggle, and especially if you are a newer small business, a pattern of struggle just does not bode well for the longevity of your business.

We work with businesses all the time that are intently focused on marketing, branding and lead generation—which is terrific, but they overlook the fundamental importance of having cash coming in order to sustain their endeavors. This is why we thought it essential to offer some advice regarding how you can help keep that positive cash flow.

Pre-Sell Products

One way is to drum up business as well as establish some incoming revenue. Preselling or pre-orders can act as a great promotional technique as well, as you encourage potential customers to get ahead as far as their shopping needs.

Understand what your expenses are

Here is where so many smaller companies do falter. They fail to keep an accurate account of all that is going out versus what is coming in. So before you know it, your expenses well overshadow your revenue—a definite lose-lose situation.

Raise Prices

While this may not be the ideal solution, sometimes it’s a necessity. Depending on the industry you’re in, you may start by testing such an increase on only certain products.

Revisit Vendors

Vendors and suppliers want to keep your business. There may be some room for negotiations. You won’t know if they’re willing to work with you until you approach them about it.

At First Union, we would certainly love to help you come up with ways in which to generate positive cash flow. Our line of small business lending solutions may also be a way to help you out in the short term. Call today and see what we can offer you!

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