It’s no secret that inflation is making the cost of running a business prohibitively expensive. But with a few adjustments, you can avoid the cash flow pinch. Here’s how.

1. Track your payments and how quickly they settle

“I keep it all in my head.” It may be tempting to fool yourself into thinking you know what’s coming in and going out of your business, but without cold, hard data, you may be in for a nasty surprise.

This is even more relevant if there’s a gap between when a customer pays you and the time it takes for that money to land in your business account.

So it pays to look closely at the features of your payments service providers. ANZ Worldline Payment Solutions offers same-day settlement so you can track your cash flow day to day and pay staff, bills and suppliers on time.

At the end of each day, you can review your point-of-sale or eCommerce reports to see exactly how many sales you’ve had and the total amount taken. You can then check that this has been deposited into your account.

As well as same-day settlements, make sure your merchant provider offers an easy-to-use dashboard where you can keep an eye on any refunds and your ability to process them.

2. Take payments by card instead of invoicing

As noted, getting paid faster helps you track your cash flow and can save you money in the long run. Anytime you’re waiting for payment from a customer or a supplier means your cash flow is stemmed. If you need to buy stock quickly, you may need to put that on your business credit card or take out a loan, thereby incurring high interest fees.

So rather than sending out invoices and waiting days or even months for payment, get your customers and suppliers to pay by card, either online or via your EFTPOS terminal.

“Even if you offer direct bank transfer on an invoice which may save on card fees, not everyone wants to or has the ability to pay that way,” Keenan France, Merchant Specialist at ANZ Worldline Payment Solutions, tells Kochie’s Business Builders.

3. Dig deeper into your card transaction fees

Fees on card transactions made by your customers can rack up your costs of running a business. Make sure you know what your payment provider is charging you for different types of cards (ANZ Worldline, for example, charges the same rate regardless of the type of Visa or Mastercard your customers use).

It’s also worth investigating if Merchant Choice Routing is right for your business. This is where a contactless Visa or Mastercard debit card is processed through the EFTPOS debit system at much lower rates instead of the usual credit network.

For some types of businesses, particularly those with higher average transaction amounts, it can save hundreds of dollars a year in card fees.

4. Negotiate and be flexible with your suppliers

While the ideal scenario for any business is to be paid in full and fast for products or services rendered, there are times when you need to spread out your payments to suppliers.

Say you need $10,000 worth of organic raisins to fill a bulk order of your vegan chocolate cookies to a retailer. You may not have the whole amount, or if you do, it could mean not being able to buy other stock or pay your staff. Again you may need to put this cost onto your business credit card or take out a loan, both of which can attract high interest rates.

You can save money by developing strong relationships with your suppliers that allow you to negotiate extended payment terms or implement payment plans.

5. Re-evaluate your prices

Businesses are doing it tough at the moment, with the cost of goods and ingredients skyrocketing due to inflation. Export milling wheat, for example, which is used to make flour for bread and other items, is currently selling for $608 a tonne, an increase of 39 per cent compared to the price at the same time last year.

This means you may have to increase your prices to make a profit.

Undercharging is notorious in some sectors (hello social enterprises and businesses-for-good). But if you’re not making enough to ensure your business is viable, you’ll end up with an expensive hobby.

When you’re going through your expenses, make sure you factor in the cost per customer transaction.

“This includes knowing exactly what fees you’re paying when a customer pays you with their credit or debit card,” Keenan adds. “Also, make sure your payment provider checks if you’re eligible for Merchant Choice Routing, which can also save you money.”

Learn more about ANZ Worldline Payment Solutions’ EFTPOS terminals and eCommerce payment gateways here.

For a limited period, ANZ Worldline Payment Solutions is offering free terminal rental for 12 months to new customers. Apply before 16 December. Terms and conditions and eligibility criteria apply.

This article is brought to you by Kochie’s Business Builders, sponsored by ANZ Worldline Payment Solutions.

ANZ Worldline Payment Solutions means Worldline Australia Pty Ltd ACN 645 073 034 (“Worldline”), a provider of merchant solutions. Worldline is not an authorised deposit taking institution (ADI) and entry into any agreement with Worldline is neither a deposit nor liability of Australia and New Zealand Banking Group Limited ACN 005 357 522 (“ANZ”) or any of its related bodies corporate (together “ANZ Group”). Neither ANZ nor any other member of the ANZ Group stands behind or guarantees Worldline.

This publication is intended to provide general information only and should not be relied on in substitution for professional legal or financial advice. Any opinions, conclusions or recommendations are reasonably held, based on the information available at the time of publication, but are subject to change without notice and Worldline Australia Pty Ltd makes no representation as to the accuracy, reliability or completeness of the information. Any projections, forecasts or forward-looking statements contained in this publication are based on a number of assumptions and estimates, are subject to contingencies and uncertainties and may not eventuate. To the extent permitted by law, Worldline Australia Pty Ltd will not be liable to any person for any error or omission contained in the webinar or for any loss or damage suffered by any person relying on the information contained in the publication.

Feature image: AdobeStock