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How to manage cashflow with flexible payments

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Cash flow is critical for small businesses. They need to have sufficient cash flow to cover expenses, such as rent and payroll, as well as purchase new stock and supplies to run and grow their business. But too much positive cash flow isn’t necessarily a good thing, since they could be investing the cash into the business, rather than leaving it in the bank.

Striking this balance is hard, especially given the natural ebbs and flows that every business experiences. The seasonal nature of retail, for instance, means many shops place large stock orders in July and don’t recoup their costs until the Christmas sales rush in December. And tradies may find that their work slows down in the summer months when people are on holiday.

While it has never been easy to manage cash flow, COVID-19 has made it even more challenging, due to the drop in consumer spending and increase in late payments from suppliers. According to CreditorWatch, payments were overdue by 49 days on average in Australia in June 2020, a 342% increase from June 2019.

This has created a cash flow crunch, and many small businesses have been forced to seek financing simply to keep up with expenses, such as rent and payroll. But even if they’re able to access finance, which surveys show isn’t very easy, the terms of a bank loan or credit card may not actually be very desirable.

With small businesses clearly in need of an alternative to traditional finance, learn more about the new solution helping address the credit crunch.

Instead of relying on traditional finance, small businesses can regain control over their cash flow simply by being smart about payments. Splitting payments up into smaller amounts or deferring payments until there is sufficient cash flow in the business to cover expenses means small businesses can continue to meet financial obligations, such as payroll and rent, throughout the year.

This doesn’t mean becoming a bad corporate citizen and passing the buck — and stress — of late payments onto other businesses, or putting off the purchase of much-needed supplies. Thanks to hummpro — a new buy now pay later (BNPL) solution designed for the B2B market.

When businesses make a payment with hummpro, they have up to two months to pay it off interest free, but if they need more time, they can ‘pause’ their repayment for a fee, or split it into six, nine, or 12 monthly payments plus a monthly fee. Unlike a credit card, line of credit or trade credit account, with hummpro, businesses don’t need to clear their account by a certain date before making another purchase. They get fresh terms each month.

For years, studies have shown that poor cash flow is one of the leading causes of small business failure, but there are new ways to manage it by being smart about payments.

Be smart about payments and take back cash flow control. Get access to up to $30,000 with no interest via the hummpro app. Do business now, pay later.


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