March 2016
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Manage your cashflow

There is no greater pain in small business than not getting paid. Cashflow is a pain point for one in five small businesses* – and focusing on managing the money coming in and going out is even more important during tighter economic times. Signals provides you with insights into trends, activities that affect cash flow, and tips and tricks on how to maintain a healthy flow of money in and out of your business. *Source: Xero Small Business Market Study, May 2015

March 2016

New Zealand small businesses are relaxed with their invoicing

Over a third send invoices just once a month and many allow a month or more to be paid before the invoice is considered overdue.**  If invoices were created more frequently and payment terms were tighter, we’d expect a healthier flow of cash in most businesses, especially in slower economic times.

**Source: Xero Signals, July 13–June 15

 

 

March 2016

Make the web work for you

78% of New Zealanders aged 18 and over buy from online stores***.  But a concerning figure from our national survey is that only 15% of small businesses have a transactional website*. This means that many New Zealand small businesses should strongly consider having an online presence to avoid losing revenue to businesses that do.

If you’re thinking of investing in a website, read our tips:

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    Having an online shop lets you see what stock you’ll need a few days in advance as well as receiving payment quickly. Your website should be easy to use, and needs to be set up so customers can find you when they search for you; in other words, your site needs to be optimised for search engines (SEO’d).

     

  • Your website should be easy to use, and needs to be set up so customers can find you when they search for you; in other words, your site needs to be optimised for search engines (SEO’d).

  • People use their smartphones and tablets for everything, so make sure your website is mobile-friendly.  This means that the website adjusts to the size of the screen you are viewing it with and delivers the right amount of content.

  • Engage the services of a good website builder – they’ll make the complex easy for you and your customers.

Check out how to succeed in the online retail business or our checklist for selling on Amazon.

* Xero Small Business Market Study, May 2015

***Source: Colmar Brunton Market Mood Monitor, Nov 2014

 

March 2016

Streamline your invoicing

Use job management and invoicing systems to keep track of all your jobs from quoting, scheduling and completion to invoicing.  A smart invoicing tool also makes invoicing easy and offers online payment options, for a faster flow of money.  

Such tools have features that let you generate an invoice while you’re out and about, or on a job, which puts you ahead of the game. The faster a customer receives an invoice, often the sooner you get paid and the better your cashflow. Check out more tips on easy-to-use invoicing software.

March 2016

Change your invoicing process to suit the times

Many New Zealand small businesses set up their invoicing cycles and payment terms as if they are a corporate that needs to negotiate terms for payment at a certain time each month. This is an outdated practice. Here are five quick tips that might help you get tighter control over your invoicing.


Tip 1: Invoice immediately – don't just do it once a month.  Small businesses can benefit from invoicing promptly and encouraging immediate electronic payment as soon as the job is completed.  You could consider a mobile EFTPOS terminal or a mobile app to receive payment – like these ones from ANZ and BNZ.

Tip 2: Reduce your payment periods from 60 days to 30 days, or from 30 days to 14 days.

By payment periods we mean the time you give your customers to pay the invoice once you have sent it to them. See our top seven tips on invoicing payment

Tip 3: Get on top of late payments quickly with gentle reminders – a friendly text message or email is often all you need. Read our tips on how to manage your finances and cashflow.

Tip 4: Employing an expert bookkeeper is a great investment. For as little as $100–$150 a week, a bookkeeper will provide continuing support with activities like invoicing and chasing payments.

Tip 5: A bookkeeper will also provide sound advice on improving your accounting processes and systems to automate debtor management, and financial reports so you can keep a closer eye on your cash.

For more tips on improving your invoicing, check out our guides on streamlining your invoicing process and nailing your invoice management.

March 2016

Don’t just survive, it's time to thrive

Increase your cashflow days so that you’re not just surviving each month.  Our Xero small business market study identified that thriving business were more likely to have a plan and employed more technology tools*.  The next few topics provide handy tips on activities and tech tools that can help you improve the flow of cash into your business.

*Source: Xero Small Business Market Study, May 2015 

March 2016

Have a plan

If you have a solid business plan in place, you’re likely to see improvements in your business performance.  Make sure to share your plan with those helping you achieve it. Only 30% of small businesses have a written plan and many don't know where to start.* Here’s a template to help you create the perfect business plan.

*Source: Xero Small Business Market Study, May 2015

 

Have a plan
March 2016

Reinvent your inventory

Don’t tie up money on products you can't move. Understand which products contribute to the bottom line and move them faster. A rule of thumb says 80% of revenue comes from 20% of products. Here are two things to think about:

  • Consider lowering your stock holding levels: try smaller amounts for shorter times, rather than larger amounts for longer periods.  If you give this a go, you’ll need to be extra vigilant about your stock levels to make sure you don't run out.

  • Our market survey shows that only 12% of small businesses currently use an inventory management system*.  Adopting one can bring increased discipline to your business and help with cashflow management.


To find out more, check out our business guides on inventory optimisation and why it matters for your business and how to create an efficient inventory management system.

 

*Source: Xero Small Business Market Study, May 2015 

Reinvent your inventory
March 2016

Strengthen your customer connections

A customer relationship management (CRM) system not only supports strong customer relationships and loyalty; it  also typically enables better cashflow management through timely invoicing and collection. From our small business market survey we know that only 10% of small businesses use a CRM*, yet many could benefit from adopting one. Check out our tips on CRM for small business.

*Source: Xero Small Business Market Study, May 2015

 

March 2016

Go paperless

Storing your documents digitally is a win-win all round.  They’re less cumbersome to store, easier to find, simpler to send and receive. This translates to lower costs, less printing, less paper, fewer storage facilities and more efficient access to information. Check out our guide on how to have a paperless office.