Why Small Business Owners Are Flocking to Treasury Management Solutions to Improve Cash Flow and Reduce Risk
In today’s fast-paced business environment, operational efficiency is crucial. Companies are constantly looking for ways to streamline their processes and improve cash flow management. One powerful solution that can help businesses achieve these goals is the use of treasury products. These specialized financial tools are designed to manage a company’s liquidity, optimize investments, and mitigate financial risks, ultimately improving overall business operations.
Whether business owners are seeking accounts receivable solutions, accounts payable solutions, or looking to implement fraud prevention products, integrating treasury products into their financial strategy makes sound business sense. By leveraging these tools, businesses can simplify their operations, enhance cash flow visibility, and ensure better financial management.
Despite these advantages, some businesses still overlook the benefits of treasury management products. This oversight often leads to avoidable financial challenges that could be mitigated with the right solutions in place.
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The #1 reason small businesses fail is cash flow. 82% of small businesses experience cash flow problems. Source: Score
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Don’t Let Cash Flow Ruin Your Business
Consider a small business managing its cash flow manually without the help of automated treasury management systems. In such cases, the business may struggle with delayed payments, inaccurate cash forecasts, and inefficient financial planning. This lack of automation and precision often leads to missed business opportunities and strained supplier relationships.
Similarly, businesses relying solely on traditional banking services often face challenges when managing multiple accounts. These challenges can result in inefficiencies, increased operational risk, and a higher potential for fraud. Without integrated treasury solutions, a small business may be exposing itself to unnecessary vulnerabilities in its cash management processes.
Many small business owners cite the size of their company or their perceived lack of resources as reasons for not pursuing treasury management products or implementing treasury strategies. However, this mindset can be detrimental. In many cases, business owners end up spending more time and money addressing accounting issues reactively rather than proactively improving their treasury management systems. By not investing in automated treasury tools, they miss the opportunity to streamline their operations, optimize cash flow, and better plan for the future.
Common Problems Faced
- Cash Flow Management: Businesses without treasury products often experience cash flow issues, as they lack real-time visibility into their finances. This can result in overdrafts or missed investment opportunities.
- Operational Inefficiencies: Manual processes can lead to errors and delays, affecting everything from payroll to supplier payments.
- Risk Management: Without proper tools, companies are exposed to market risks such as currency fluctuations and interest rate changes, which can significantly impact profitability. Treasury products also help with fraud prevention.
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Business owners in Texas can expect to lose around $150,000 annually due to fraud with smaller businesses often being the most targeted victims of fraud. Source: Association of Certified Fraud Examiners (ACFE)
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Automating treasury management processes can help small businesses reduce errors, improve cash visibility, and enhance decision-making. Leveraging modern cash management tools enables better control over finances, reduces risk, and strengthens business relationships with suppliers and banks.
A local Texas emergency medical billing company experiencing rapid growth understood the importance of treasury management solutions and as such, reached out to a community bank for help. Here is their story.
“At Emergicon we were looking for a new banking relationship and it was important for us to work with a regional bank that works closely with their business clients,” said Emergicon CEO, Christoper Tuner. Turner recognized that the right banking relationship would be crucial for scaling their operations. He continues, “it was important that they (Veritex Community Bank) understood our aggressive growth and would be able to be there for us. We’ve had no issues in growing with them, in streamlining, opening new accounts, adding lines to our treasury management, adding additional banking products, it’s all been seamless, and they’ve been involved in helping us understand how to get some of the underlying technology right so that growth isn’t burdensome in terms of banking and treasury management.”
What Can My Business Expect To Gain Through Treasury Management Products?
Businesses can leverage a variety of treasury products which will increase control over finances by replacing tedious hands-on functions with automated, electronic processes.
- Cash Management Services: These include automated payment and collection systems that ensure timely transactions. By using these services, businesses can maintain a consistent cash flow, reducing the risk of late payments and improving supplier relationships.
- Investment Solutions: Treasury services offer investment products that allow businesses to earn returns on surplus cash. By strategically investing excess funds, companies can enhance their financial position without compromising liquidity.
- Risk Management Tools: Tools like Positive Pay offer protection to keep unwanted checks and ACH transactions from posting to a client’s account.
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Almost one third of small business owners encountered check fraud in 2023, according to Mitek.
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Another important consideration is the efficiency treasury products offer business owners. Consider how local Texas company, Lift-Aids utilizes treasury solutions for their day-to-day operations. “Veritex (Community Bank) is literally two blocks from my house, but I have a check deposit scanner sitting on my desk and I can make deposits throughout the day, said Amanda Jones, owner and operator of Lift-Aids in Euless, Texas. “Just using the tools that Veritex Community Bank offers me as a small businessperson, that right there just helps tremendously.”
How Veritex Community Bank Provides Solutions
The Treasury Team at Veritex Community Bank is made up of expert analysts and consultants dedicated to understanding you and your business. By gaining a complete picture of your company, we can recommend the best solutions tailored to your unique needs.
You can learn more about our team in this video with our Managing Director of Digital and Treasury Solutions, Wyatt Abernethy.
Contact Us
Explore all of our convenient and easy-to-use services or contact Veritex Treasury Services at treasurysales@veritexbank.com for more information. Our team is ready to help you find the right solutions to meet your business needs.
Unlock Business Growth with Treasury Products: A Smart Strategy for Financial Efficiency and Risk Reduction
Incorporating treasury products into your business strategy is not just about managing cash flow—it’s about creating a more efficient and resilient operation. By addressing cash flow inconsistencies, reducing financial risk exposure, and optimizing investments, businesses can position themselves for long-term success.
Outdated financial processes can limit your business’s potential. Don’t let inefficiencies hold you back; explore treasury management solutions today to streamline your financial operations and pave the way for sustainable growth.