As a security dealer, you strive to provide top-notch security services and give customers exactly what they need. But what about your own business, and what you need? Sometimes those day-to-day details, like ensuring a healthy cash flow, can get lost in the mix as you focus on serving customers first.
But since you’re here reading this now, it’s a good time for a cash flow check-up. Let’s talk about how you can ensure there’s enough of it to get you through those inevitable industry ups and downs, irregular revenue streams, fluctuations in demand, and occasional, unexpected overhead costs. We’ll cover accurate payment processing and billing, how you can adapt and expand your services to stay flexible, and how to ensure you always have enough cash on hand for when life takes you by surprise.
Master your cash flow and help your business function at optimal levels. Here’s how you can do it.
#1. START GENERATING MORE REVENUE
Let’s talk about the exciting part first: how you can generate more revenue. We’ve written about revenue-generating ideas in the past, and it’s worth highlighting again. The quickest way to ensure a healthy cash flow is to generate more cash! Our top two tips are to focus on building recurring monthly revenue (RMR) and expanding and diversifying your services:
Prioritize recurring monthly revenue
A large up-front payment may feel great when you sign on a new customer, but here’s what’s even better: reliable RMR. Across our industry, security dealers are finding ways to build a dependable flow of revenue at all times of year through offerings like managed services and software-as-a-service. And their approach is paying off: according to SDM, 73% of security companies using a recurring monthly revenue model are seeing a significant increase in revenues and averaging 20% growth!
So give your cash flow some healthy stability–and growth potential–by prioritizing RMR. You could offer customers subscription-based maintenance plans, cloud storage options, managed access control, video surveillance as a service, cybersecurity services, and more. Check out these ideas to get started.
Another way to generate RMR is to encourage customers to pay for security installations on a monthly basis, with interest. Spreading their payments out over a longer period of time guarantees a steady flow of cash for your business–and may even entice customers to invest in bigger security projects than they would have otherwise. Ultimately, it’s a win for you both.
Bundle your services and diversify revenue streams
Another great way to boost cash flow is to package your security and alarm services with complementary offerings like surveillance camera installations, cybersecurity services, various vulnerability assessments, consulting, and more. You can also think about expanding into complementary markets: what about security consulting or training?
#2. SPEND YOUR TIME AND MONEY MORE WISELY WITH THE RIGHT TECHNOLOGY
The best way to keep your cash flow healthy is to manage it wisely. Your advantage is that you have tremendously powerful technology available to do just that: the right software can help you streamline your billing and payment processing and stay on top of how much money is flowing in and out of your business each day. A great technology solution should also help you streamline your business operations so that you can cut down on wasted time and money.
Invest in the right technology
How good would it feel to abandon all the programs, documents, spreadsheets, and tabs sprawling across your screen right now? What if you knew that there was a single software solution that would help you streamline everything you do right now, and help you do it better and faster?
You probably already know that switching between paper files, various software programs, Word documents, and Excel sheets can be a massive drain on your energy–or on your cash flow, if you’re paying people to spend valuable time on these time-sapping tasks. But what can you do except grit your teeth and grind on, right?
Not so fast. A better bet is software purpose-designed for how you work: a solution like Bold Group’s Managely, for example, can simplify everything from invoicing to work orders to managing customer records. Managely is a business management solution designed specifically for the security industry. It makes it possible to accomplish almost everything from a single dashboard, so you can free yourself from clunky processes and spend more time serving customers, making sales, and generating fresh revenue.
Automate billing and payment processing
The worst part of making money…is chasing that money down. You know what we mean: there’s making the sale, and then there’s getting paid for the sale. And what happens between those two points can be a long and perilous journey involving lost invoices, missing payments, chronically late customers, and hours spent creating and formatting fresh invoices each time you make a sale.
You know that the key is to keep money flowing into your business at a predictable rate–which means knowing exactly where your invoices are going and when they’re due. That’s where technology can step in again, with automated billing, late payment reminders, and robust payment processing. A solution like Managely can help you set up automated and recurring monthly invoices, as well. Wouldn’t it be nice if invoices practically sent themselves? That’s what we thought, too–and that’s why we built Managely. Use it to effortlessly manage your cash flow as you get back to taking care of business.
#3. GET A HANDLE ON EXPENSES
Generating more revenue–and keeping better track of it–are just two pieces of a bigger puzzle. The next thing you’ll have to do is get a handle on expenses. This involves negotiating with your suppliers and bringing your operating expenses down to a manageable level.
Negotiate payment terms with suppliers
The big-picture idea should be to better align your cash outflow with your revenue inflow. That means taking a proactive stance when it comes to working with suppliers. Don’t wait for them to come to you: speak to them now about more favorable payment terms that work with the rhythm of your business. For example, you could negotiate extended payment terms, different payment dates, or discounts for early payments on purchases.
Control operating expenses
Next, periodically evaluate your operating expenses so you can cut down on unnecessary costs and give your cash flow a boost. You can find opportunities everywhere–from streamlining your everyday business processes to saving time (and, by extension, money) using technologies that help you get more done for less.
#4. PREPARE FOR A STRONGER FUTURE
Finally, keep an eye on your money, where it’s coming from and going, and where and when it’s likely to flow next. The reality of being a security dealer and business owner is that you will inevitably go through up and down periods. That’s OK if you can predict these peaks and troughs and adjust accordingly.
Forecast your cash flow
Take some time to think about the big picture and become familiar with how cash tends to ebb and flow out of your business. Ask yourself: are there busy periods and lean periods? Do you pay for major equipment or services at a certain time of year, or are these obligations spread out? When do you seem to make most of your sales, and when do you tend to spend more? Knowing the rhythms of your business cycle can help you estimate future cash needs and help you prepare accordingly. And again, technology like Managely can help you see it all from a birds-eye view.
Build up your cash reserves
No matter how well you plan, however, sometimes things just happen–and you need cash to cover the shortfall. That’s why you should make it a habit to set aside a portion of your profits every month, creating a healthy buffer for when times are lean or emergencies take you by surprise. You can’t prevent unexpected expenses from cropping up, but you can be sure that they will happen to you at some point. It’s best to be prepared for when life inevitably hands you an unexpected surprise: your cash reserves can help you remain resilient and allow you to bounce right back.
THE RIGHT SOLUTIONS, RIGHT WHEN YOU NEED THEM
It’s exciting to think about all the ways you can grow your business and streamline your operations. That’s why we’re passionate about helping security dealers do just that with our world-class Managely software. If you’re curious about how Managely can help you and your business, give it a try today–we’re here to help answer questions and ultimately help you make your business even stronger.