The Vault
Tips to keep your small business cash flowing
by Graham Barber

Looking for a way to improve your company's cash flow? No small business can thrive without cash flow to pay bills, suppliers, employees and - you! One of the best ways to maintain a positive cash flow is with well managed accounts receivable. Keeping track of who owes money and your due dates keeps your business efficient.

Here are a few tips to keep your accounts receivable - and your client relationships, in top shape.

- Know your customers. Do some research before granting credit to a new client. This may involve talking to a credit rating agency to help determine a client's credit history.

- Talk to your clients. If there is a concern about a late payment, call your client. If there was a problem with your product or service, it provides you with an opportunity to correct it and satisfy your customer.

- Set parameters. If your clients know at the outset what the terms of payment are, they are more likely to follow them.

- Keep good records. No business owner likes additional paperwork, but keeping track of who owes you money - and who you own money to, is critical to maintaining a good client relationship.

- Considering offering a discount for early payment of bills or an interest penalty for late payments to encourage customers to pay your promptly.

- Arrange and encourage your customers to use credit and/or debit cards tom pay you, both of which provide instant cash.

- Know what your customer wants so you can deliver it. For some it may be your superior product, personal service or flexibility. This helps tom establish long-term business relationships that can weather the storm of the occasional difficulty with invoices.

"Effectively managing your business borrowings helps to manage your overall business costs," says Diane Giard, Vice President, Small Business at Scotiabank. "With a little understanding and negotiation, you'll be able to maintain strong client relationships and keep your cash flowing."

Scotiabank has the knowledge and resources to help small business owners succeed. With a small business expert in every branch, Scotiabank is here to help small business owners find the money to reach their goals. For more information, see your local branch manager or go to www.scotiabank.com/small business.

The proceeding information was provided by Graham Barber, Branch Manager of Scotiabank, Alcona Branch.

The Scotiabank, Alcona Branch, is located at 1161 Innisfil Beach Road, (705) 431-6116. The Vault is a weekly series of articles provided by Graham Barber with financial advice and suggestions.