Four cashflow heroes

Help your clients protect their cashflow with these tips on avoiding hidden dangers.


Cashflow is an important factor when considering growth or responding to changing customer needs, but staying on top of it is a tough challenge for many businesses.

“Managing cashflow effectively is one of the most important ways to make a business successful,” says Luis Santos, Head of Lending, Business Banking. “The wealth of digital resources now available, including those we offer to business owners and their advisors, can help reduce the time and effort needed to do this well.”

Accountants and business intermediaries often play an important role in making things easier for their clients – here are 4 common ways to avoid the pitfalls.

1. Maximise efficiency

Business inefficiency can hurt cashflow in various ways.

Operational inefficiency can make it harder to keep customers satisfied, especially in businesses without clearly defined roles and systems. As well as creating potential for higher wastage, staff time and delivery costs, inefficiency can have a longer-term hidden cost on staff morale and customer satisfaction.

Failing to deliver products, issue invoices and chase debts on a timely basis places cashflow under unnecessary pressure. As so many processes can now be automated, could your clients be better equipped?

Investing in people with the right skills and technology feels like a tough decision when resources are limited. If your clients come to you for guidance, you may be able to provide the reassurance some business owners need to take action that will help protect and enhance their business. Alternatively talk to your Business Development team.

2. Realise the value of time

Passionate about their business, entrepreneurs often find it difficult to step back, instead getting caught up doing jobs that others are already being paid to do.

Losing that time comes with a cost to the business. By taking on tasks that others could reasonably do, it’s likely an entrepreneur’s business is, in effect, paying a lot more for their team than they need to. This also gives business owners less time to generate extra sales or spot strategic opportunities, at an extra cost to the business.

Our SmartBusiness Dashboard and apps bring business and financial data together within our Online Banking, letting business owners see their key numbers at a glance, cut through the clutter and gain a wider picture of their business.

It also makes it easier to assess business performance, and consider how to plan the next steps.

3. Cull unnecessary outgoings

It’s easy to slide into bad habits and forget how expenses add up. Is spending on business development, including travel and advertising, generating a good return? Are services paid for by Direct Debit still good value for money?

Regularly reviewing costs is important, in order to consider which costs help generate revenue and which don’t – reducing this superfluous spending feeds straight into profit and cash improvements. This is why it’s key for businesses to understand the difference between ‘must have’ and ‘nice to have’.

4. Manage inventory

The way your clients manage stock can have a huge impact on cashflow.

It’s easy to be tempted by a bargain, but getting a discount to increase profit margins can often require buying in bulk. Over-buying stock due to misjudging demand, widening product ranges and not keeping track of inventory levels can hit cashflow hard.

Many products have a consumer demand shelf life, so it’s often wise to shift older stock – even at a discount – before it’s too late.

If increasing amounts of cash are tied up in stock, it may be a good time to talk about adjusting buying and selling strategies. Are they using data on customer trends to inform and improve how cash is being invested in stock?

By using Barclays SmartBusiness Insights your clients can compare costs against similar sized companies, while connecting their commerce apps to SmartBusiness Dashboard lets them view a breakdown of their best-selling products.

SmartBusiness allows clients to integrate leading accounting apps into the Dashboard to help keep track of key numbers. There are several apps which can be connected, including Xero, FreeAgent, Sage One and QuickBooks*.

To drive business performance and efficiency, take a look at SmartBusiness Dashboard.

*Subscription fees for third-party apps may apply once the free trial period ends and you wish to retain usage. The free trial period will not automatically roll over into a paid subscription; you will need to subscribe if you wish to use the app after the trial period ends.