The world of retail is one of the purest and most honest forms of entrepreneurship. For as long as there have been societies, there have been men and women to whom their peers turn to sell, buy and trade valuable commodities for cash.
Retailers, in many ways, make the world go round and ensure that the wheels of local economy are well greased. If you’ve chosen to establish yourself as a retail presence, whether in a physical store or through e-commerce, your customers rely on you to bring them the products they need at a price they love, while also providing them with a customer experience that keeps them coming back.
However, retailers also often face significant overheads. When you’re trying to deliver an outstanding experience to each and every customer, it usually requires at least a modest capital investment. Sometimes, however, your level of investment in your business is not necessarily proportionate to your profit margins or your footfall. When this happens, it can become harder and harder to maintain the cash flow that will ensure that your business runs harmoniously. When this happens, you need to take steps…
Be prepared to put your own capital in when all else fails
In some circumstances, you may need to invest your own capital into your business. While this can be a slippery slope, giving yourself a temporary pay cut to ensure that a supplier gets paid is a worthy measure to help ensure smooth cash flow. If you’re going to do so, however, it behoves you to take steps that you can get by at home financially. Whether this is by moving your savings to a higher yield account or teaching yourself about the stock market so that you can answer questions like ‘what are margins?’ you should be able to reduce the amount you withdraw from your business as a wage without plunging yourself into destitution.
Bridging finance is a useful way of getting quick money to ease cash flow or pay for a capital investment that will soon begin to pay for itself and boost your profits. Bridging loans are short term loans that can ease cash flow but they tend to come with hefty rates of interest so ensure that they are paid off as quickly as possible before they begin to eat into your profit margins.
“Everything Must Go!” sales
One of the perks of being a retailer is that when your cash flow is showing signs of slowing, you can always throw a quick sale. Sales may result in a slight dip in your profit margin but they tend to pay for themselves pretty quickly, both in facilitating cash flow and enticing new customers to enter your retail premises.
If you have an outstanding debt owed to you by a client or customer who has not yet paid their invoice, you may be able to make quick money by using an invoice factoring service. For a nominal fee they can help you to get the cash that you are owed at the end of the month today.
Retail is a noble profession but it comes with its challenges. By ensuring that your cash flows freely around your business, you can be best positioned to face those challenges head-on!