Tools & Support / Business News
Expenses could be the key
Careful management of day-to-day cash flow could make a huge difference to Shropshire companies fighting their way through the recession.
That's the message from Helen Thomas, of Dyke Yaxley Chartered Accountants, in Shrewsbury, who said cash flow was a crucial element in the operation of any business.
"Obviously long-term planning is essential, but it's often the smaller day-to-day strategies that can make a real difference.
"Managing expenses is a key part of any company's wider cash flow strategy, and it's vital that businesses get the process right from the outset."
Helen said employers should set out a best practice guide for expenses and ensure that they stuck to it.
"It may sound obvious, but an effective expenses system needs to be carefully planned, and it's surprising how many companies fail to put this in place.
"You should also communicate clearly with your staff to make sure they understand exactly how the system will work. Be strict with the deadlines you set and you'll avoid any nasty surprises coming in when you can least afford them."
Helen said taking care to ensure that every expense was charged against the correct code would save a lot of time, and make it easier to see what is being spent and where.
"It may be useful to set up a database of suppliers with whom you have negotiated the best rates, and remember that an economic downturn is the perfect opportunity to strike a bargain.
"Encourage your staff to use only these chosen suppliers so that you're always getting the best value on all purchases, from stationery right through to corporate travel."
She said a team effort was imperative if companies were to find a way through these challenging times, and all staff should be encouraged to think about managing cash flow and costs.
"If you can, automate your expenses system, which will help to minimise any unmonitored spending and which will check that the correct cost codes are being used.
"And as the situation is constantly changing, it's a good idea to review your policies regularly so you can identify any points you need to adjust."
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