For most businesses today, cash is king, and as uncertainty continues to reign in the economy, finding ways to optimize the flow of money through the business is essential. With payrolls to meet, bills to pay, and taxes to pay, the business’s profits are the primary casualty of poorly managed cash flow. Even if sound cash flow principles are followed, there may be some ways to improve it even in down business cycles.

Here are five steps that can immediately impact business cash flow:

Manage accounts receivable:All businesses suffer at the hands of customers who are chronically late in their payments. A more proactive collections effort is the first order of business. If not already in place, a stated billing policy should be communicated to customers. The invoice and follow-up process should start as early as possible. If your invoices have gone out 30 days before the due date, change it to 45 or 60 days.

Don’t be afraid to send out a past-due notice one day after the due date and keep them coming. Studies have shown that when notices are followed up with a "friendly voice reminder," payments come in sooner. Your policy should clearly state the penalties that will be assessed for late payment and all follow-up notices; the penalty fee should be highlighted.

Early payment rewards:Customers respond to discounts and like the idea of being rewarded for being a good customer. By offering a 5% discount for payments received before the due date, you’ll have more cash on hand and more loyal customers. You can also offer discounts when orders are paid upfront or with a deposit.

Negotiate discounts:You won’t be the only one offering discounts for early payment. Many of your suppliers will do the same thing. You may have to negotiate a discount with them, but many are also concerned about cash flow and will likely entertain the idea. Conversely, you can arrange payment extensions to reduce the monthly outlay.

Increase customer revenue:It never comes too late to realize that the profit is not in the sale of your product or service; the profit is in your customer. Most of the cost of doing business is in acquiring a new customer.

When customers buy again, it generates almost pure profit. Promote sales, discounts, new offerings, and referral rewards to your customers. It’s good marketing, and it’s also sound business.

Delay payments:You can use the billing cycles built into your creditors’ payment terms to delay payments for as many as 50. This includes your credit cards as well as your bank lenders. Study your creditors’ payment terms to learn when their billing cycle starts and the length of the grace period. If possible, pay on the due date using a bank transfer.

These are some steps that any business can take to begin making positive strides toward an improved cash flow situation, no matter the economic environment. Once implemented, they can become the key to effective cash \management on a continuing basis.