Managing cashflow and fluctuating staff demands in business
The busier I get, the less cash I seem to have in the bank. Cash flow management is one of the most important aspects to running a small construction business and due to it’s unpredictable nature, it’s also the most challenging. Here are 5 key dangers to watch out for to reduce your risks:
- Staffing - having too few and you can’t complete the work on time but taking on too many and your payroll will become bigger than your income
- Underpricing Jobs – read our tips to avoid that here
- Bad payment terms – Outgoings need to be paid on time or you get penalized, so make sure you consider this when setting your own payment terms
- Financing assets out of cash flow instead of being financed over the useful life of the asset – Vans, Utes, Tippers, Equipment, Office Computers – give this careful consideration
- Bad debtor management – don’t get over reliant on one contractor, sadly, contractors are going bust everyday so you must cover yourself & always prepare for the worst
ConX is here to work with your fluctuating labor demands, so you staff your business as needed. Register today to access a pool of tradespeople ready to work.