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What difficulties will arise when running a wholesaling business?

Running a wholesaling business is a little different than operating as a different type of seller. In this scenario, you're not delivering goods directly to their end users – instead, your job is to sell to other sellers. This means your business results are dependent upon theirs. Your customers will only need products if their customers do; you're only going to have a productive month of sales your clients do as well.

It's difficult to predict what your financial results will look like from one budgeting cycle to the next.

This might make the process of cashflow forecasting complicated. With your results being dictated by so many factors that are beyond your control, it's really difficult to predict what your financial results will look like from one budgeting cycle to the next. When running a wholesaling business, you face unique difficulties; you need a unique strategy to address them.

Can you move your company's inventory?

Perhaps the most challenging aspect of wholesale finance is keeping the right levels of inventory at all times. Too little product on your shelves, and you have no source of future revenue; too much, and your cashflow might be in trouble. Entrepreneur Magazine notes that the wholesaler's challenge is to sell your inventory away at exactly the right pace.

"Operating very efficiently and turning your inventory over quickly are the keys to making money," wholesaling consultant Adam Fein said.

Fein added that being able to understand your customers' needs and finding ways to serve them well are key priorities as well.

Watching for signs of cashflow trouble

You need to keep selling your inventory if you're going to continually have enough working capital to operate. You also have to collect payments on each sale in a timely fashion. It's crucial for wholesaling business leaders to pay attention to their accounts receivable – if they're frequently having trouble with late payments or non-payments from customers, this might turn into a major business issue.

Address cash flow issues quickly, or they might someday bury you.Address cash flow issues quickly, or they might someday bury you.

If you can't address such problems directly by communicating with customers and working out solutions, you may need to look elsewhere for assistance with funding during tough times.

Getting extra capital when you need it most

In the course of running your business, do you ever have times when you need cash but can't seem to get your hands on it in time? If the problem is money getting tied up in debtors' books, we have a solution at Cashflow Finance. Connect with us, and we'll float you the money you need via debtor finance.

You don't want to worry about debt collection speed anymore – and thanks to us, you won't have to. Talk to us today about how we can get you quick cash during times of need.

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Debtor finance can help SMEs start the new financial year right

 

The start of a new financial year is often a time of both great excitement and a fair amount of worry. After all, with a clean slate in front of you, you want to put a little pressure on yourself to start the year off right. Are you doing everything you can to steer the business towards a bright future?

Having just a few customers who haven’t paid their debts can put a damper on an otherwise promising year.

It’s easy to have doubts if you enter the year with lingering accounting issues. For example, having just a few customers who haven’t paid their debts can put a damper on an otherwise promising year. If you have any lingering troubles like this, it’s best to address them in a proactive way so you can proceed into the new year with confidence. We have a couple of suggestions on this front – including the use of debtor finance.

Focusing on cashflow from the start

If you’ve got any issues cash-wise, don’t let them linger – get the working capital you need lined up at the very start of the year. Now’s the time to act on this, according to Dynamic Export. Because the new year is a clean slate, it’s a perfect time to take the temperature of your business and see if you need to address any cashflow issues.

Think about how your financial results turned out last year. Is there anything you can do to improve in the next 12 months – perhaps collecting debts faster or otherwise sealing off any “gaps” in cashflow? If so, don’t wait.

Take a closer look at your process for invoicing customers.Take a closer look at your process for invoicing customers.

Getting on top of invoicing early

Every business depends on having a smooth, well-oiled invoicing process. The moment you make a sale, you want to have a foolproof method for making sure the cash you’re owed gets collected. The Pulse Australia recommends the beginning of the financial year as the ideal time to take a look at your process and make any necessary changes.

If you’ve tried improving the invoicing process and nothing works, you may want to consider alternative finance solutions. One fine example is debtor finance, which can give your company a boost when your accounts receivable are moving slowly. Companies of all sizes, in all industries, can benefit from debtor finance – to learn more about how just get in touch with us and ask.

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Exploring the many hidden costs of hiring new employees

There's no doubt that when you're running a small business, every new employee you hire can make a huge difference. If you only have five people in house, for instance, adding a sixth team member can bring a giant boost to the group's productivity, and with that comes higher morale and greater potential for future growth.

Unfortunately, there are a lot of hidden costs involved with each new person you bring on board.

Unfortunately, though, there are a lot of hidden costs involved with each new person you bring on board. It's never quite as simple as, "Hire an employee with a salary of X, then add X to your budget." Whether you like it or not, you'll find yourself dealing with costs Y, Z and then some. It's simply part of the process.

Is your business prepared for that financial burden? If not, you should be.

Hiring can eat into your savings fast

You might think you have the working capital available to hire a new employee, but it also might cost more than you think. Workplace Info cautions that if you're bringing on a new employee at a salary of $35,000, it might cost about half that – another $17,500 – to do all the recruiting and onboarding.

That figure includes direct costs, such as advertising the position and hiring consultants to help you recruit; it also includes more indirect expenses like the productivity you lose while taking time to interview and train people. In the long run, all that money adds up.

How will you plan for the expense?

If you're aware of the costs of hiring in advance, it's easier to plan for them. According to Smart Company, one thing you can do is size up the hiring budgets that most companies use and look for ways you can do the same thing for cheaper.

Consider dialing up your personal network to find job candidates.Consider dialling up your personal network to find job candidates.

For example, can you manage the recruiting process yourself instead of hiring staffing experts? Can you find candidates through your own network rather than pay cash to advertise jobs? Strategies like this can make it easier to build your staff without breaking the bank.

Get a little help with your cashflow

Inevitably, there will be times in business where you want to add to your staff, but you just don't have the capital available to do it. To address this problem, you may want to consider getting debtor finance to help.

At Cashflow Finance, we offer solutions that give you quick access to cash – a hefty percentage of the amount you have receivable. Forget about being tied up by unpaid invoices. Instead, you can press forward and build a better business with confidence.

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How will you address issues with cashflow in small business?

If you run a small business, you’re probably well aware: Having problems with cashflow can be crippling. If you don’t have the capital available to pay your employees and address other financial needs, your organisation might be in jeopardy. For this reason, it’s best to be proactive about collecting debts from your customers quickly and getting cash in hand.

If you encounter cashflow problems in the course of running your business, how will you address them?

However, this is sometimes a struggle. Sometimes debtors don’t want to pay up in a timely fashion; in other situations, they want to do so but simply can’t find the cash. If you encounter problems like this in the course of running your business, how will you address them?

Protecting your profits is key

Everyone wants to make a profit in business, but unfortunately some have trouble doing it consistently. Often, the problem isn’t sluggish sales, but an inability to collect on those sales. The latest “Payment Practices Barometer” study from Artradius found that 24 per cent of Australian companies say cashflow is the biggest challenge to their profitability.

“Due to the vulnerability of its economy to low commodity prices, many Australian businesses have a strong focus on trade receivables management, and on protecting their cashflow and profitability,” Artradius’ Mark Hoppe said.

Attacking cashflow trouble on two fronts

If you’re experiencing cashflow trouble at your business and you’re eager to do something about it, you may need a multi-pronged approach. The Pulse Australia recommends attacking the problem on two fronts – one is tightening up your trading terms, and the second is enforcing those terms.

Draw up a strategy to overcome your cashflow issues.Draw up a strategy to overcome your cashflow issues.

You might decide that giving your clients 30 days to pay is too much; you need cash faster. That’s a good first step, but you also need to follow up – the second step is enforcing the rules by reminding your customers that they need to pay on time consistently.

If that fails, the other option is to look beyond your business’ four walls for alternative finance solutions.

Getting fast cash when you need it

If you need to improve your company’s cashflow and it doesn’t seem like anything is working, one solution you may want to try is debtor finance. At Cashflow Finance, we can offer you upfront payments of up to 80 per cent of the amount your customers owe you.

Using debtor finance is a great move for all sorts of businesses, small and large alike. If you need a little help smoothing out your company’s cashflow, all you need to do is ask.

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What challenges will you face buying new equipment for your business?

 

Especially in some sectors like manufacturing, where your employees are doing tough manual labour every day, having the right equipment in place at your facility can be crucial. Good equipment helps your business run at peak efficiency; settle for subpar infrastructure, and you’ll probably get subpar results.

It’s not always easy to do the math and figure out how much good equipment is worth to you.

Having said that, it’s not always easy to do the math and figure out how much good equipment is worth to you. Equipment adds value to your business in the form of greater productivity; it also takes it away, in the form of cold hard cash. How much should you be willing to spend to upgrade your business? It depends on the financial challenges you’re up against.

Assessing your business needs

When you’re mulling the decision to buy new equipment for your business, you need to think critically about how it will improve your operations. The Business Development Bank of Canada recommends taking a hard look at your objectives first. What are you trying to do – improve employee efficiency, increase sales or defeat a specific competitor? Can you quantify how much the equipment will help?

Too many people make rash decisions about equipment purchases based on aggressive marketing campaigns they’ve come across. The trick is to think not about the product or the sales pitch behind it, but about your business and what needs it has.

Figuring out your cashflow first

Aside from how much your business needs the new equipment, the other consideration is how easily you can afford it. Construction Business Owner recommends that before buying, you should look at your company’s cashflow and think about how a big purchase will impact your budget. You might think you have the capital to buy, but what if there are issues with collecting debts or otherwise managing money?

Does your company have the cashflow to make a big equipment purchase?Does your company have the cashflow to make a big equipment purchase?

Ideally, you’d be able to make a purchase comfortably and still have enough cash left over for a rainy day. If you can’t do this yet, it might be worth asking whether there are finance solutions out there that can help you.

Getting help if you need it

Are you in serious need of new equipment for your business, but you’re having trouble coming up with the working capital you need to buy it? If so, you should consider the equipment leasing and financing options we have available at Cashflow Finance.

When you work with us, the process gets easier over time, as no financials are needed for existing customers. We’re eager to build a relationship with you and help you make numerous equipment purchases over the long haul. Just reach out to us to learn more.

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Unpaid invoices can be a major hindrance to your business

To maintain a healthy organisation, you need to keep the cash flowing, and that means billing customers and collecting the cash you're owed in a timely fashion. Unfortunately, that's sometimes easier said than done.

Having outstanding debts can be a major hindrance to running a successful business.

Does your company have a problem with invoices that are going unpaid? These outstanding debts can be a major hindrance to running a successful business. Without collecting money quickly, you risk being unable to pay your employees or meet other basic financial needs. How can you turn those invoices into faster cash?

Improving your invoicing system

If your business has an ongoing problem with unpaid invoices, the solution might be to revamp your invoicing system and cut down on non-payments, according to the Department of Industry, Innovation and Science. This process should begin with writing invoices that are easy to understand – it should be stated in no uncertain terms how much each client owes and when the amounts are due.

The most important part of staying on top of your accounts is establishing expectations surrounding payment. If your customers know what's expected of them and agree to it from the start, it should be easier to follow through and collect your cash when it's due.

Understanding people's pain points

Even if you do everything in your power to smooth out the invoicing process, difficulties still arise sometime. Customers have various pain points. For example, they might quibble over acceptable forms of payment, such as cheques or credit cards, or they might have currency conversion problems if they're international. Deadlines might put them into a time crunch.

Try to understand the pain points your customers are dealing with.Try to understand the pain points your customers are dealing with.

Whatever problems your customers might have, it's important to listen to them and understand where they're coming from. If you can address their financial concerns and still get paid on time, great; if not, you may need to explore alternative finance solutions.

Getting quick capital when you need it

In business, money is no good if it's tied up in your debtors' books. You don't need the promise of money; you need actual working capital. At Cashflow Finance, we're committed to helping you get it.

We offer debtor finance solutions that allow you to have quick access to cash when you need it. If you have accounts receivable but you're not getting paid, reach out to us and ask for help. We'll deliver.