April 5, 2016 By Suzanne Robertson

Managing cash flow can be extremely challenging. Uneven cash flow is a top challenge for small businesses, according to research by the Federal Reserve Bank of Cleveland.

Here are a few ways to avoid a stressful cash flow crunch!

Apply for an SBA Loan

Invoice Regularly

Avoid sending invoices at random times during the month. Have a set day when you distribute. This will avoid any confusion and let your customers and clients know when they can expect your invoice so they can plan accordingly.

Implement Late Fees

Whether for a credit card or a library book, the words “late fee” usually cause people to sit up and pay attention. An easy way to make sure you’re not waiting on late payments is to make a “late fee” policy clear on your invoices. According to Entrepreneur Magazine, effective policies include a 5 percent late penalty after five days and work stoppage after 30 days past due (for service-based companies).

Use a cash-flow statement

This tool will help you track revenue and expenses for a specific time period so you can anticipate money coming in and plan ahead if you hit a rough patch. If you don’t use a cash-flow statement, you’re basically guessing. The SCORE Organization has a cash-flow template you can download. The template will allow you to plan your cash needs for a 12-month period by combining your starting capital and cash expenses.

Build an emergency fund

Easier said than done! Try to put away as much money as you can in an emergency fund. This is a good time to seek additional low-cost funds that you can use to build savings.

Cut back

Review all expenses, even the little ones that can cut into your cash flow. Big expenses like travel and meal costs can add up. Perform an overall analysis of all of your small business expenses. If a cost isn't providing a return on investment, cut back or completely eliminate that expense.

Explore additional financing

Low-cost funding can help small business owners manage cash flow. SBA loans are the best bet to grow a small business and consolidating high-interest existing debt can save hundreds or even thousands per month. SmartBiz is the #1 online marketplace for fast and easy low-cost SBA loans. Our SBA loans offer low interest rates, loans up to $350,000, low monthly payments and funding in as fast as 7 days after the application is complete. We’ve streamlined the application process to be fast and easy. Prequalify in 5 minutes with no impact on your credit score here.

See if you pre-qualify