As credit tightens and the economy slows, building business sustainability may appear to be on the bottom of the priority list for some small businesses. However, small business resources are available to help those sustainable businesses using the supply chain to address current environmental concerns.
Consider managing cash flow as tool to not only help your business stay afloat in troubled times but also as a means to integrate sustainability concepts to your business processes.
- Begin with understand cash flow and prepare a monthly cash flow projection.
- Send out invoices as soon as they become payable rather than waiting until month end. Implement invoice follow up procedures that resolves disputes earlier and prevents delays in payment.
- Manage your receivables. If most are over 30 days, consider offering discounts for prompt payments. Engage with late paying clients. Maintain exceptional standards of attentiveness and correspondence with customers/ stakeholders to better understand needs and concerns.
- Review current investment and borrowing strategies. If you do not have an investment policy create one that includes social responsible investing. Any prior strategies are most likely out of date and have not been incorporated into your business sustainability plan.
- Reconcile bank and credit card statements on a timely basis to avoid costly deadlines to report disputes or fraudulent activity.
In my professional consulting, I encourage clients to bring eco awareness to their business operations that indirectly impacts cash flow.
- Improve energy efficiency and reduce costs
- Review waste management and recycling programs
- Evaluate water usage
Modifying existing practices may provide for improved cash flow management as well as maintaining business sustainability.
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