How Xero Improved My Cash Flow
It takes more than earning a profit to stay in business. Unless you are able to properly manage your cash flow, you run the very real risk of not having enough cash on hand to cover your operating expenses. If you find that you don’t have enough cash coming in to cover your expenses, or, if you don’t have enough cash on hand at the right time, you likely won’t be able to remain in business very long. A good accounting system can help you to increase the actual cash that’s coming into your business while also making it easier to manage your cash flows.
Based on personal experience, I can honestly say that the Xero accounting system makes it easy to both increase the money that you have coming in while also helping you to know how much you have to spend and when it’s safe to spend it!
Fast and Easy Options for Billing and Invoices Are Key to Increasing Your Cash Flow
One of the top factors that influence your cash flow is, of course, how much and how often you are paid for your work. The ability to bill and invoice clients is one area where Xero truly excels in comparison to other accounting software.
Xero makes it easy to send and approve invoices to your clients immediately, even if you are on the go, via their mobile app. You can also directly bill your clients electronically with Xero’s online invoices that include a helpful “pay now,” button so that your clients are able to pay you immediately. With a few clicks of your mouse, you can immediately bill your clients as soon as you’ve completed the work, while the bill is fresh in their minds, and they have a greater motivation to go ahead and pay you, before they forget about the great job you have just completed for them!
If you combine the easy invoicing options offered by Xero with rewards, such as offering your customers a 5 to 10% discount if they pay quickly, you will also see a dramatic increase in your cash flow, almost effortlessly.
Xero also makes it easy to keep up with those clients that might be a bit tardy in paying what is owed to you. Xero makes it simple to see who owes you the most money, and who has owed you the longest, when you click on your aged receivables report. Once you know who owes you money, and how much they owe, you then have the ability to personally follow up with your clients, perhaps in person or on the phone, and encourage them to go ahead and pay any late invoices.
Why it’s Easier and Faster to Manage Your Cash Flow with Xero
In addition to fast and easy invoicing, Xero’s intuitive dashboards make it simple to see at a glance where you stand financially with all of your accounts. The program and all of your files remain in the cloud, which frees up space on your computer and allows you to quickly perform transactions and other operations so that you have fast and up-to-date information about your finances at all times.
Another area that Xero excels is in the ease and speed with which it creates reports, no matter how frequently you request them. Other accounting software systems make it difficult to run frequent reports, which make it harder to get a firm grasp on where you and your business stand at any given point in time. If you don’t have the ability to call this information up at a moment’s notice, it’s far too easy to make a miscalculation and spend funds that you really can’t afford to. Many times you can improve your cash flow simply by having the ability to KNOW how much you are spending and when you are spending it.
In addition to helping you improve your cash flow, Xero’s ability to help you create and run frequent statements, balance sheets and end-of-period reports also gives you the information that you need to make better decisions about your business, particularly when it comes to long term strategic planning and goal setting.
Xero can also improve your cash flow because of its ease of use and compatibility with other systems, which can lower your IT and payroll costs, giving you more money to spend elsewhere.
Xero has the ability to fully integrate with the software of a wide selection of other vendors, which makes it easy to import your data from an older accounting system, so that you no longer have to go to the time, expense and hassle of maintaining records on more than one system. Xero is also easy to integrate and use with several add on services such as CRMs, online stores, marketing automation, POS and even Google Apps and social media which will also increase your productivity while also saving you additional payroll costs.
Despite its ease of use, there are times when you might want to invite a collaborator, such as a direct member of your business team, an accountant, business partner or even an IT professional, to be able to access and use your financial data. Xero puts business owners in the driver’s seat and gives them the full power and control to invite as many users as they choose, while also employing encryption and other security processes to keep their information safe from those who shouldn’t legitimately have access.
Do you have additional questions about how Xero can help you improve your cash flow? Why not contact us and schedule a consultation today? Together, we can create a plan that will get you started on the road to improving your cash flow and getting a better handle on your business finances!