How to Improve Cash Flow and your Business’s Success

Cash flow is the lifeblood of any business, essential for daily operations, growth and stability. To ensure your business thrives, it’s crucial to continuously improve your cash flow management. Effective cash flow management ensures you have the funds needed to cover day-to-day expenses, invest in growth opportunities and navigate through any financial challenges that may arise.

One key aspect of optimizing cash flow is utilizing the right financial tools and services. WesBanco offers a range of treasury management solutions designed to streamline your financial operations and enhance your cash flow management. From electronic fund transfers to wire transfers, WesBanco provides secure and efficient payment options that can help you manage your cash flow more effectively.

Here are seven tips to help you maintain and improve your cash flow:

1. Create Realistic Cash Flow Forecasts

Create and update cash flow forecasts regularly. Base your projections on historical data, sales cycles and economic conditions. This helps you anticipate cash needs and avoid overly optimistic estimates.

2. Budget for Cash Flow Considerations

Create a cash flow budget to track expected revenues and expenses. A cash flow budget is a financial plan that outlines the expected cash inflows and outflows of a business over a specific period. Creating a budget helps you identify potential cash shortages and plan accordingly to maintain stability. Having a cash flow budget serves as a valuable tool for businesses to forecast and manage their cash flow effectively, optimize liquidity and make informed financial decisions.

3. Invoice Quickly and Regularly

Establish an efficient invoicing process to ensure timely payments from customers. Consider requesting a down payment upfront and billing promptly upon project completion to avoid delays.
With tools like Autobooks, WesBanco can help you streamline your invoicing process and get paid faster.

4. Secure Prompt Payments

Make it easy for customers to pay you by accepting various forms of payment. Consider offering discounts for early payments or penalties for late payments to encourage timely settlements. At WesBanco, we offer ACH Debit Origination to give you better control over your cash flow. ACH Debit Origination gives you a secure payment tool to receive payments and provide convenience and reliability for your customers.

5. Maintain an Adequate Emergency Fund

Having an emergency fund set aside is essential for any business. Aim to build a cash reserve equivalent to at least three months of operating expenses. This provides a safety net for unexpected expenses and ensures you can continue operations during slow sales periods.

6. Secure Cash Management Solutions

WesBanco offers cash management solutions that can significantly increase cash flow. One example are wire transfers, which allow for the electronic transfer of funds from one account to another. Wire transfers are often used for high-value transactions or when funds need to be transferred quickly and securely. They offer several benefits for businesses:

• Speed: Wire transfers are typically processed quickly, often on the same day or within a few hours, making them ideal for urgent payments.
• Security: Wire transfers are considered a secure method of transferring funds, reducing the risk of fraud or theft compared to other payment methods.
• International Transfers: Wire transfers can be used for international transactions, allowing you to send and receive payments from overseas clients or suppliers.
• Certainty: Unlike checks, which can bounce, wire transfers provide a level of certainty that the funds will be received, making them a reliable payment method for important transactions.
• Automation: Many financial institutions offer automated wire transfer services, allowing you to schedule regular payments or transfers, improving efficiency and reducing manual errors.

In addition to wire transfers, WesBanco offers electronic fund transfers (EFTs), which allow for the electronic transfer of funds between accounts. EFTs are commonly used for recurring payments, such as payroll deposits or bill payments. They offer similar benefits to wire transfers, such as speed, security and automation, making them a convenient option for managing your cash flow.

WesBanco’s CashFlow Connect includes features like account reconciliation, ACH payments, and Autobooks invoicing, simplifying your money management and letting you focus on what’s important.

Connect with our advisors to discuss the option that would best suit your business.

7. Explore Financing Options

Whether you have short term cash flow gaps or are looking to grow your business, WesBanco has financing options to increase your cash flow. Consider securing a line of credit or a line of credit or a business term loan.  Business lines of credit provide businesses with flexible access to funds for managing short-term cash flow needs, such as covering operating expenses, purchasing inventory or funding growth opportunities. Other cash flow services include opening a business credit card, which eliminates the need for more costly alternatives such as petty cash or cash advances.

Learn more about WesBanco’s Treasury Management options to find a solution that supports your company’s growth and goals.

By implementing these tips, you can improve your cash flow management and position your business for long-term success. If you have additional questions on cash flow management, reach out to your local WesBanco Branch. They can guide you through the world of cash flow and assist you in making choices that align with your business’ financial success.

Content is for informational purposes only and is not intended to provide legal or financial advice. The views and opinions expressed do not necessarily represent the views and opinions of WesBanco.

While we hope you find this content useful, it is only intended to serve as a starting point. Your next step is to speak with a qualified, licensed professional who can provide advice tailored to your individual circumstances. Nothing in this article, nor in any associated resources, should be construed as financial or legal advice. Furthermore, while we have made good faith efforts to ensure that the information presented was correct as of the date the content was prepared, we are unable to guarantee that it remains accurate today.

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