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How to Maximize Cash-on-Hand

3 min. read

Sep 18, 2018

As we approach the holiday season, cash flow becomes a critical issue for many small businesses and resellers. Rather than taking out a bank line (standard 5% – 6%) you could be using the line of credit you already have in your wallet. Below, find a few tips and tricks to make the most of the credit you already have on hand.

Put your largest expenses on a credit card

A few standard (recurring) expenses can take up a lot of a small businesses’ cash on hand. Think of expenses like: commercial rent, insurance, janitorial services, fleet vehicles and payroll. Put these expenses on card and float out the cost, freeing up more cash on hand for your business. If you pay down these expenses each billing period, you’re essentially getting a half price bank line through Plastiq (*2.85%). Write off part of the Plastiq fee against your tax liability for further savings (see chart below). Many clients are able to write the essential fee down to ~1.97%. With any 2% back card, you’re making money. You can use these funds to secure more inventory for the holiday season and help grow your business.

Negotiate with your Vendors

Vendors will often times be willing to offer and/or negotiate an ‚ ‘Early Pay Discount.’ It is worthwhile reaching out to your point of contact or AR department at your largest suppliers to see if this is something they offer. Propose terms of 2/10 net 30, wherein, if you pay your bill within 10 days of the invoice date, they’ll cut you a 2% discount. With Plastiq, you’re able to leverage our domestic and international wire features to pay your vendors as quickly as next-day. We’ve seen clients negotiate up to a 5% early-pay discount by using these tactics.

You could also try to extend your standard net terms with your vendor on top of negotiating an early pay discount. Most businesses don’t realize that the standard net 30 terms aren’t concrete and oftentimes are extended out to 45-60 days.

Paying Down Your Statement

To maximize float, you should always pay your card down the day after your statement closes to gain the maximum float on your card. This will allow you the maximum amount of days to float out your expenses.

Check out our other articles for even more tips and tricks.


Colin Morgan – Gold Amex User


+2.00% Cash Back

Many cards offer 2% cash back or points on every purchase.

+0.66% Savings On Debt

Avoid costly loans (even the best ones cost 7-8% annually) – or earn interest on increased cash flow.

+0.75% Business Tax Deduction

The Plastiq fee can be classified as a business expense on tax returns.

+2.00% Early Pay Discount

Negotiate better payment terms from your vendors when you pay early.

5.41% Potential Net Benefit

Gain additional value with extra cash on hand and Plastiq referrals.

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