How to Make Your Cash Flow More Predictable

Does an unpredictable cash flow make it difficult for you to manage your business? When you’re not sure what your expenses or income will be in any given month, it can be difficult to know what you can afford to spend or even if you’re going to be able to survive for that month. However, even if your cash flow isn’t consistent from month to month, you can still find ways to understand it better. You can create a more predictable cash flow that helps you to manage your business more easily. Here are some of the steps that you can take to achieve that.

Keep a Rolling Forecast

Although you might not always know exact numbers for your cash flow, it doesn’t mean that it’s entirely unpredictable. Predicting it over the next year could be tough, but you should be able to create a forecast for the next few months. Take a look at previous months, and perhaps this time last year, and you will have numbers that help you to predict what will happen over the next three or four months. Every few months, you can create a new forecast, learning all the time to make more accurate adjustments.


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Balance Out Seasonality

Businesses that are busier during certain seasonal periods can find it hard to predict and manage their cash flow. If this sounds like you, the obvious answer is to try and sell more in your off-season. This will help to close the gap between your busiest months and your quietest months. What opportunities might be available for you to target a new market or even release a new product or service? Of course, it’s also helpful if you are able to carry over some of the profits from your busy months to help keep your business going when it’s not so busy.

Choose Flat-fee Services

If your expenses often go up and down, it might be useful to look at flat-fee services as alternatives. When you only have a set fee to pay, you know what you’re paying, and you know what you’re going to get for that amount. One expense that you could switch to a flat-fee service is your IT support. Managed IT services from companies such as Egis Technologies, Inc. give you a single fee to pay. You pay your monthly fee, and you know that you’re going to get the support that you need when you need it.

Secure Long-term Customer Contracts

Instead of constantly having to chase leads to secure new contracts, consider trying to secure more long-term contracts with customers. This will give you the reassurance and certainty of a more regular income. What if you could secure a contract that lasts for several months or a year instead of just a month at a time? It’s easier to predict your cash flow if you have longer contracts that you can rely on.

Don’t let an unpredictable cash flow put your business in turmoil. You can take control to make improvements and manage your business more easily.


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