Effective ways to manage the cashflow of your business

Cash is a fundamental element of the management of a business, it is the financial pillar that keeps it in balance at the risk of seeing it languish under the weight of bankruptcy.

It deserves to be managed with attention and a lot of professionalism. How to get there? Here are some tips for managing the cash flow of your business.

What is cash and why manage it?

It is the capital available to a company to use for its needs. Cash allows the company to use its financial resources, but it often happens that some companies go through difficulties that do not allow them to have sufficient financial resources. In this case, the company is unable to finance some of its investments which can have serious incidents on it. This lack of availability can force it to close its doors, hence the need to manage cash well.

Good cash management enables the company to avoid cases of default and save money, like services such as pay calculator take home can serve you well for manages your cash flow. It also allows the company to grow the surplus through long-term investment.

How to manage the cash flow of your company?

Since the company’s survival depends on its cash flow, here are some tips that will help you manage it well.

Negotiate bank loans

Certainly, these rates and interest rates can weigh on the company, but it is always good to start an activity by using a bank for a loan to finance equipment, premises, stocks. To qualify for this credit, you must be a competent entrepreneur, stand up to the competition and have a viable business.

Using an indicator, build your cash flow

Enter your opening balance and any financial movements you make monthly. You will have the opportunity to appreciate, to comb through your cash, and even to anticipate some problems. Similarly, it is important to keep track of incoming and outgoing payments made during the month.

Maintain good relationships (trust) with your customers and suppliers

This in order to bring more money into your coffers . Offer discounts to customers who pay their bills instantly and request an extension within the timeframe for paying your bills to your suppliers . Once this period has been granted, pay cash and meet immediately. Likewise, do not be afraid to be hard on bad payers when it comes to recovering your debts.

Make your operations simple by avoiding enough waste

It’s a good idea to increase production and make your business profitable, but watch out for overproduction, bottlenecks and other waste that can lead you to bankruptcy. Have your employees participate in the growth of your business. 

Finally, finding the right balance to manage your business cash flow is a top priority for longevity and success.

Is blockchain’s open financial tools and services an opportunity for entrepreneurs?

Outside of the novelty and consistent price speculation of cryptocurrencies, one trend that has fast materialized is for an open and more accessible financial ecosystem.

With the expansion of regulation and infrastructure, facilitating open financial tools loom large, and while this innovation is for the greater good, many entrepreneurs are stuttering at the scale at which this sector is growing. From open source tools to standardized identity protocols like anti-money laundering, the digital asset market is slowly converging with different economic structures that will help entrepreneurs in the long run.

Open and integrated finance

Decentralized or open finance is a type of interoperable financial system that involves transparency, standardization, financial inclusion, and increased accessibility. This opens the opportunity for financial tools to play a more crucial part. For example, crypto traders are using trading tools and indicators to check the market condition before investing. Tools like BTC Profit System offer the most accurate information of the currencies and their expected behavior by using a combination of algorithms.

This approach has also helped many cryptocurrencies to lower their barrier so that investors can access transfer mechanisms and value storage. The currencies are trying to create a separate class of assets and remove intermediaries that exist outside the existing financial system.

One of the most significant aspects of this movement is the emphasis on different financial tools built on blockchain protocols for digital assets. Since these projects are expanding on the basis of blockchain technology, they are useful to build open financial instruments that offer more transparency to entrepreneurs; something that they had been looking for all this while.

Open financial tools

The introduction of open financial tools is providing secured lending services. This sector has a massive potential to benefit new entrepreneurs as it constitutes the biggest part of the open finance structure. However, other financial systems that are also gaining ground are decentralized prediction markets and security tokens, especially after utility tokens saw a downfall in the last couple of years.

Although the potential of various open protocols is still there, experts believe that the market is highly unlikely to experience a wholesale transition when it comes to financial instruments operating on the blockchain.

What is more likely to happen is the introduction of a hybrid ecosystem involving digital assets and open protocols with integrated businesses and traditional financial systems. It is still early days to consider a paradigm shift from traditional to digital in the next few years. So, a convergence is what everyone expects to happen.

If an open financial system has to exist, it will require a lot of innovation and proper infrastructure in different sectors. Financial and regulatory institutions in the United States are approaching a more mature market before jumping into the concept of digital assets. More startups are shifting their attention from ICOs to regulatory-compliant digital assets and transparent security tokens. Even ICO models are now focusing on anti-money laundering and KYC processes to reduce this transition and regain the market they have lost. So, entrepreneurs can be assured that the open financial tools and services will work in their favor instead of going against them.

Uses of machine learning in finance

If you wonder whether to implement AI and Machine Learning into your financial business or not, this is an article for you.

We will discuss here the advantages and disadvantages of this solution. Machine Learning is ideal for the financial service’s industry because there is always an enormous database to operate and the more data you have the better for you because due to that the AI can learn faster.

Yes, investing in Machine Learning requires some significant amount of money which often is a major concern but the payback is quick to be noticed. Here are some examples of what Machine Learning is capable of doing.

Automation of customer service

The use of Machine Learning saves your company’s energy, money and time. It can even replace regular employees by taking over the whole part of the company responsible for customer service. AI can answer e-mails and phone calls, and can also respond to requests via chat on a website. The program can teach itself to answer more and more accurately, and eventually become the master of customer service. Machine Learning can also provide the company with improved training for employees and even perform it.

But then, these solutions are obvious and do not regard only financial businesses. Well, when it comes specifically to the field of finance, AI has also a lot to offer. For example, it is very effective in detecting fraud, helping to make the best trading decisions and instantly predicting a level of credit risk.

Detecting fraud

It is sometimes hard to see small anomalies in the financial habits of customers and to be honest no one can monitor all their clients all the time. AI, on the other hand, can. It processes tons of information every second and detects those anomalies in an instance. What is more, it can not only detect but also immediately prevent fraud because of how fast and accurate it operates. Preventing fraud results in blocking suspicious operations, transactions, and accounts. Of course, if there is enough percent chance of them being abusive.

Processing information on credit risk

Automation of analyzing the solvency and credit risk of any customer benefits companies greatly. There is a really small chance of any mistake and there are no emotions involved in the process which unfortunately is essential in financial services. Generally speaking, AI protects your company from making bad financial decisions that can hurt your business. It considers many factors, some of which could seem irrelevant to a human being but all in all, make a great difference.

Analyzing the stock market

AI is capable of analyzing thousands of data all day and all night to track patterns and predict the state of the market. That is something that no human could ever achieve. Nevertheless, the results of those operations are very desirable. Every little change that has been predicted can save or earn lots of money within seconds.

Read more: https://addepto.com/finance/

Half of business owners regret attitude towards cashflow

Nearly half of business owners fear they’ve held back their business by having a naive attitude towards cashflow during their company’s infancy.

Almost two-thirds of those who identified cashflow naivety as their largest regret suggested that they overspent before gaining any profit, ultimately leaving them in larger debt than they could manage.

Those in the business services, such as sales or marketing regretted their attitude to cashflow, with 65 per cent in these sectors claiming it almost ended their business venture, training providers were second most regretful and manufacturing third.

Industries in London feel they regret their cashflow decision with almost half of business owners feeling they made mistakes, which was fractionally higher than the national average of 47%.

The study gathered data from business owners to identify what UK SME’s view to be their biggest financial mistakes.

Gaining enough funding was also a major regret with two in five business owners claiming they made the wrong decision in starting a business with the budget they had.

Recruiters felt they made the worst choice with 62 per cent stating they didn’t take advantage of better funding options; this was followed by the manufacturing and retail industries.

Those in the arts felt the most comfortable with their start up budget as only 1 in 5 claimed they had any regrets regarding funding.

More than a quarter of business owners claimed they “didn’t know they could receive loans and grants” and simply used their own money to help support their start up.

Those in the legal sector had the least knowledge on funding options available to them, this was followed by owners in transport and logistics and healthcare.

Although the details of grants and loans can vary depending on business location, over one in four of the surveyed business owners in London admitted they had never researched options available to them.

Shockingly, more than a quarter of UK business owners regret not creating a financial plan or forecast during their start up.

Compared to the national average, less business owners in London regretted their financial planning with only 22% fearing they’re hampering their businesses due to a lack of forecasting.

Lack of funding for marketing during a start-up was also highlighted as a major regret for UK business owners, with more than a quarter claiming they didn’t budget for this expense.

The biggest culprits that didn’t have marketing budgets include business owners in transport and logistics, recruitment and manufacturing.

More than a third of businesses registered in London failed to put any budget towards marketing.

Surprisingly, 13% of UK business owners don’t regret any of the financial decision they made during their start-up.

Andy Dodd, Managing Director at Hitachi Capital Invoice Finance, who conducted the research, said, “It’s fascinating to find out just how many businesses have lacked financial planning such as not forecasting or budgeting for key start-up essentials such as marketing costs.

“We are really passionate about helping people start their own businesses and try and support wherever we can, I hope this survey allows new business owners to look at their own financial planning and re-consider those critical spends they need to plan for.”

‘Bank on Dave’ moves step closer to realising dream of being first UK-owned High Street bank in 120 years

Business champion Burnley Savings and Loans Limited (“BSAL”), also known as “Bank on Dave!”, has taken another step towards becoming the first UK owned high-street bank in 120 years and today are announcing a £2.5 million funding round on equity crowdfunding platform Seedrs.

BSAL was established in 2011 by local millionaire businessman Dave Fishwick in the wake of the financial crash and the devastation it left across the North of England.  As a man passionate about his hometown of Burnley, Dave wanted to set up his own business in Lancashire to help inject much-needed support into local community and businesses, and to prove that financial service providers can be socially responsible.

BSAL seeks to respond to the significant market need from SMEs and individuals who may have difficulty or are unable to access credit from mainstream high street financial companies. One of the driving aims of the Company is to lend responsibly, therefore providing the customer with greater opportunity to control their debt, which in turn will help support an improved credit rating in the future.

Over the past 7 years, the Company has seen that customers seeking a modest loan may in the future turn into a customer that wishes to borrow a much larger amount to support their business’s growth, therefore creating a compelling ‘feeder’ acquisition strategy for the Company. 

Dave wants to put the trust, ethics and best-practice back into banking, treating customers as individuals and valued clients. Creating a bank that is an institution from the community, for the community.  

Having already lent nearly £20 million to over 3,000 qualifying borrowers across the UK, the Company is now seeking to grow its reach by becoming an authorised UK bank, which will be called “Bank of Dave”. To do achieve this, BSAL is launching their fundraising round on Seedrs to support the procurement of the IT systems needed in preparation for its bank license application. 

Burnley Savings and Loans Founder, Dave Fishwick said: “The core vision for Bank of Dave is to be the ethical choice provider of loans and savings products to honest hard-working families, helping every generation to grow their business and to save for the future.

We have had brilliant few years acting as a savings and loans provider, but the opportunity to become a fully authorised UK bank will expand our horizons even further, enabling us to help more people around the UK.

We are delighted to be launching our first ever funding round on Seedrs, giving our hundreds of thousands of amazing supporters a chance to share in the first new UK-owned high street bank in over a century.”

CEO James Bradley commented: “We are going through the authorisation process to become a bank and are advancing towards our goal of becoming an authorised UK bank. We continue to witness a real market demand for financial providers that offer essential banking services to customers that traditionally found it difficult or have been unable to access affordable credit. We are confident that once fully authorised that the Bank of Dave will be the bank that delivers this capability.”

For more information, visit: www.seedrs.com/bankondave