Every business is based on its financial strength. The main motive of every business is to earn profit and make money. This makes a good amount of cash flow the most important aspect of all businesses, regardless of industry and type of stores they operate. Particularly, in a brick-and-mortar store, cash flow management is a little bit more challenging than in an online store as the task includes more types of transactions (cash, digital payments, etc.). Understanding the pain point of every business owner and operator, we are here to help. In today’s article, we’ll present meaningful tips for managing cash flow in your offline stores.
Importance of cash flow management
Cash flow is the most important part and the core of any business. Cash flow management is the foundation from small local to huge multinational companies. If you earn more and spend less as a firm, things are going well with your cash department. But if it is the reverse, everything becomes extremely complicated and unexpected. That means it’s high time you started managing your cash flow. There are various reasons why you, as business owners and operators, must manage cash flow properly in your physical stores:
- It keeps your offline store well-balanced and you will never run out of cash.
- You won’t have to purchase goods in credit which will keep you free of the pressure.
- Extended cash shortages can be easily avoided.
- Your business will start to grow and become financially stable.
- You will slowly start making a profit out of your business.
Tips to manage cash flow in physical stores
Be aware of the cash flow
You might have an accountant or a staff member helping you maintain the details regarding cash. But you must keep a record of your cash flow. And you will have to do this regularly. It can be on consecutive days or weekly or sometimes monthly. The duration depends on your schedule. Ask your staff to send all the details regarding the transaction per day. Make sure to check the details regularly.
Once you are aware of the economic standing of your business, you will have an idea of your spending. If the cash flow is good, you can keep spending normally. But if the cash flow is poor, start cutting costs related to the business. Spend only on the things that are much required and necessary. When you start spending less, a balance will be created in your cash flow. This balance will eventually help you to increase the cash flow of your offline store.
Make proper use of your unused assets
Every office or store has at least one spare asset. It can be something that you bought but it became of no use later. It might be something that you thought would be useful but just ended up adding the cost and wasting your money. In that case, you can consider selling that. It is anyways of no use. So when you sell it to someone else, you can at least make some money out of it. Also, you will get some space cleared in your store and you can fit in something else there. Making proper use of the assets helps you to generate cash flow and manage it. It also helps you overcome your offline store or business losses at times.
Try leasing things
When you start a business, everything is happy-go-lucky. You want a great office or a great store. Things must be perfect and attractive. You feel like getting brand new stuff for every corner of the store. Second-hand goods are not an option. You want to own everything. But sometimes, leasing things can be a good option. It can help you to cut the costs. When leasing, you can get things like vehicles only on the day when you need them. If you own a vehicle for business purposes and it is not of daily use, you can think of giving it on rent as well. Second-hand things are also a good option if you don’t want to hire. Buying everything that is too brand new can put a lot of monetary pressure on your business. The cash flow gets equally affected.
Stop giving credits too much
This rule applies to every retail business and offline store. You are not a huge firm or a multinational company. So stop giving goods or services in credit. When you give credit, it creates an imbalance in your cash flow. This imbalance can make your business suffer a lot. Giving credit once or twice can make it easy for the customer to take goods in credit every time. So you should completely restrict giving goods and services on credit. When you get a large order, you can take advance instead. Advance payments help you economically and it also gives you assurance regarding the order.
Get help from third-party technological tools
Sometimes, you might have much difficulty regarding cash flow management. It might be due to a lack of experience or poor time management. When you are new in the retail business, you want some immense guidance about managing the cash flow. Several POS systems can help you manage your cash flow in such a case. Mobile payment integrated into a POS system can also be an option to manage cash flow fast and conveniently.
Wrap it up
When you start following the tips listed above, you will be able to increase and manage the cash flow in your offline store. This will eventually make you financially independent and your business will start to flourish. Cash attracts cash. So once you stabilize the cash flow in your business, you can start expanding it and making a profit out of it. All in all, your offline store can get huge benefits from the tips listed above.
We hope that we helped. And if you feel like you still need an extra helping hand, we can do it for you! We, ConnectPOS, are proud to be capable of offering you one of the best POS software for your business’s success. Our POS is technologically advanced and feature-rich with a pyramid of meaningful features, including cash flow management. And we’re only one call away! Book your 14-day free trial now and let your business thrive!