By Vanessa Laymon, below, Senior Payments and Business Writer
Strong cashflow is the lifeblood of any business with cashflow issues cited as one of the most common reasons why businesses fail. To stay afloat, it’s important to have more money coming in than going out – whether that’s bringing in more sales or finding creative ways to cut expenses. In this article from payments network Rapyd, we’ll cover four top tips on how the right payment processor could help you improve your business finances and avoid getting caught in a cashflow crunch.
Top four tips to improve cashflow
1. Cut fees to keep more from every sale
2. Make it easy for your customers to pay you
3. Consider raising your prices to fight inflation
4. Go global and grow your sales
#1 Cut fees to keep more from every sale
If your business takes card payments, there could be a way to cut costs. Did you know that you don’t have to go with the default payment processor offered by ecommerce platforms like Wix, WooCommerce and Shopify? Most quality payment processing companies offer plugins that can help you reach more customers and can often lower the transaction fees you pay when people buy from you online – and they are easy to install.
Shop around to find a competitive payment processing rate with low transaction fees. If you’re already working with a provider, don’t be afraid to reach out and renegotiate your rate. In Ireland and the UK, you can save up to 80% on processing fees with Rapyd. Another important thing to consider is how long it will take you to have access to your funds. You’ll want to make sure the settlement terms work for your business. With Rapyd, you can save money on processing fees and get a free next-day settlement.
#2 Make it easy for customers to pay
To maintain a healthy cashflow you’ll want to make it easy to get paid. Go with a payment processing company that accepts all the ways your customers might want to pay. Today’s customers want to use their preferred local payment methods and they expect options. Customers want to make contactless payments with their phones and use apps and ewallets. With Rapyd, you can offer hundreds of payment types, including cards, digital wallets, bank transfers and cash to let your customers pay using the methods they trust.
There are other ways to make it easier for customers to pay too. Sending invoices, payment links and automated billing can help speed up the pay up. Rapyd lets you send invoices and easily add a payment link to SMS, WhatsApp, emails and anywhere you can paste a link. In the UK, Rapyd supports the Faster Payments System to facilitate real-time payments for virtually everyone with a bank account. Rapyd also offers automated subscription payments and recurring billing solutions.
#3 Consider raising prices to fight inflation
Is inflation taking a big bite out of your profits? Bite back without upsetting your customers. Right now, everyone is dealing with inflation and looking for ways to save money by cutting expenses. One way to hold onto cash longer is to negotiate your payment terms with suppliers. Having more time to pay allows you to better control your available resources. Managing inventory is vital to maintaining the health of your business as getting caught with too much or too little inventory is a stressor. Save money by seeking out more affordable supply options, often in other countries.
Raising your prices is another option to consider. It’s not always popular but it’s guaranteed a way to bring in more money. To avoid any backlash, let your customers know well in advance and explain the reasoning behind the price increase. In this economy, it can be as simple as sharing the increased costs of supplies instead of taking on the profit loss burden alone.
#4 Go global to grow sales
Before the pandemic, 58% of small businesses reported having international customers. With online sales skyrocketing, it’s time to evaluate your business strategy to determine if expanding internationally is right for you.
By enabling cross-border commerce you’ll be able to reach millions of new customers. Rapyd can help you accept payments in 100+ countries and payout in 190+ countries. If you’re ready to expand your business internationally, Rapyd can help you keep foreign exchange fees low and create a customised checkout experience in sixteen languages with locally preferred payment methods.
Opening your business to a world of new customers is another clever way to strengthen your cashflow.
There’s no denying how tough it is to be a small business owner now, so keeping on top of costs is more crucial than ever.
Here’s a summary of our top tips:
1. Remember, the easiest way to keep cash flowing is to increase your sales. Reducing transaction fees and business expenses also help.
2. Keep the money coming in by accepting new and popular payment methods, like sending invoices and payment links.
3. Are your prices in line with recent increases in inflation? Update your prices without alienating your customers.
4. Grow your business by expanding into new markets and even new countries and maintain a healthy cashflow for your business.
Rapyd has the tools and expertise to help you grow your business and avoid cashflow problems. Learn more and get started at Rapyd.net