It does not matter what business you are in, cash flow is vital for survival. This is even more important in the current COVID-19 environment.

The team at RSM has put together the following tips to assist you to maintain a healthy cash flow.

cash flowTip one

Ensure that you are paid for your goods or services provided as quickly as possible. Many businesses are struggling and will be trying as hard to keep their cash as you are in trying to collect it. Be sure to talk to your customers about your expectations on getting paid.

Tip two

Review your costs. What are you currently paying for that may no longer be needed in today’s market?

Tip three

The way we do business is constantly changing.  Review your processes to see if there is a better, more cost-effective way to service your customers? For example, rather than drive to your customers you could use an online platform such as  Zoom to talk to them.

Tip four

With interest rates so low, it is important to ensure you are paying the lowest rate possible. Now is the perfect time to review what rate you are paying on your loans.

cash flowTip five

If you are struggling to make your loan repayments it may be possible to restructure the loan to reduce the monthly payments. At present, you may even be able to defer making payments.

Tip six

Tax – the one thing we all love to hate. As this year is expected to be a slower year than normal, you may be able to reduce your instalments. For those that pay their tax quarterly, the first instalment is due in October 2020.

Tip seven

If your business is performing well and you want to purchase more equipment, the $150,000 immediate write-off is available until 31 December 2020. For those taking advantage of this, you may be able to reduce cash flowthe tax instalments that you are paying.

Tip eight

For those buying equipment, take the time to consider, how you should pay for this? Should you use your own cash or finance the purchase? Financing the purchase enables you to pay for the equipment over the life of it. It preserves your cash in the short term and locks in low-interest rates on the borrowing.

Tip nine

Offset accounts are a good way of maximising the use of any surplus cash. These accounts enable you to reduce the interest you are paying on loans and at the same time, the cash is still available if the need arises. This works even better if the offset is against a personal loan such as a house.


If you have any questions about your business's cash flow, please get in contact with your local RSM adviser.