4 cash flow management strategies for your business

1. Use your point-of-sale (POS) solution to track sales trends and repayment timelines

Your POS solution is an invaluable tool for understanding the inflow of cash from customer purchases. Dive into a variety of sales dashboards and analytics tools to identify trends in what your customers are buying, when and how long it takes for you to receive payment. Businesses that allow customers to use Pay by Link or invoices need to closely monitor receivables and diligently follow up with customers who delay sending payments.

POS data tools can also help you optimize inventory levels by closely tracking your best-selling offerings and only reordering those that are turning over quickly. Even if your suppliers offer bulk discounts, it is important not to tie up your cash flow in inventory purchases. Instead, allow yourself to keep money in the bank for other unexpected costs that could arise at any time.

2. Leverage faster funding options from your payment processor

After your business receives a card payment, there is a delay until that money reaches your business checking account. Batches are typically settled at the end of each business day but processing times may vary depending on your payments acquirer.

Often, small businesses cannot afford to wait – that’s why we offer tools like Everyday Funding¹to ensure small business owners have quick access to funds without taking on additional expenses. This no-cost funding solution generally makes funds available within hours, seven days per week – including nights, holidays and weekends.

3. Add point-of-sale (POS) lending options to give your customers flexibility while protecting your cash flow

When consumers make major purchases – like a new HVAC system or a large veterinary bill – they expect flexibility in payment terms to fit their budget needs. To ensure that you can drive new sales, it’s critical that you are able to offer customizable options without delaying your receivables. That’s where POS lending can help.

U.S. Bank Avvance® allows your customers to select a monthly installment plan that fits their needs while funding your business in full, usually within 48 hours. This means that U.S. Bank manages the repayment plan, freeing up your business to focus on operations rather than chasing payments.

4. Take control of your operating costs and keep emergency cash in the bank

Keeping the lights on – literally and figuratively – requires money and resources. In addition to funding tools and POS data, it’s important to carefully track your monthly expenses and plan to adapt to likely challenges. Just like in personal finances, a business should always have reserve funds to cover slow periods or unexpected expenses. If possible, have enough cash on hand to cover three to six months of expenses and to make sure you can always cover important costs like payroll. 

Your payments processor can also help you find opportunities to reduce your acceptance costs with tools like commercial card optimization and credit card surcharging.

Small business owners have to tackle countless challenges every day – but you don’t have to figure them out alone. Investing in the right tools and mastering cash flow management strategies, including best practices, can help you position your business for growth.

Ready for the next steps? Contact a Payment Solutions consultant to discuss payment options for your business. Get more cash management information and tips to help keep your business running smoothly.