Your company’s working capital is the money that allows you to operate each day. It’s what you use to manage daily expenses and keep your business going. If you are having trouble keeping a good balance between liabilities and assets, there are several options for freeing up a bit of cash.

1. Lower Expenses

Perhaps the most obvious way to increase your funds is to reduce your unnecessary expenses. Maybe you are renting a larger office space than you really need or are leasing equipment that you no longer use. Go through your expenses and cut out anything that isn’t essential.

2. Adjust Loan Terms

Interest and fees can add up, particularly if you are paying off more than one loan. If your loan payments negatively impact your working capital, you can talk with your lenders to potentially reduce your monthly payments. They are more likely to do so if you have been paying on time and have shown that you are financially responsible.

3. Collect Accounts Receivable

If your customers or clients owe you money, then do your best to collect it as soon as possible. Having too many outstanding payments can interfere with your cash flow and cause financial problems for your business. If you are having trouble with this, working with an AR financing company is an option. They can buy your accounts receivable, so you will have the money you need and will no longer have to worry about collecting the payments.

4. Don’t Overstock Inventory

While it’s good to be prepared, and you want to ensure you have all the supplies you need, don’t go overboard. If you are stocking much more inventory than you sell, then you are tying up money that you could have used in other areas. Take note of how much you use or sell and adjust your stock to reflect that.

5. Apply For More Credit

Sometimes, it can be challenging to reduce your expenses or payments. If this is the case, getting a business credit card or line of credit can free up some cash that you otherwise would not be able to use.

Having enough working capital is essential to keeping your business running smoothly. Luckily, there are several ways to increase it if you are having trouble. Keeping your expenses as low as possible and adding to your business credit is just a couple of ways to improve your capital.