The economic climate will most likely be a tough one for businesses this year. Given such expectations, profits could be hard to come by this year. Small businesses, in particular, need to look for new ways to increase profitability. Returns on the investment of working capital can make a significant contribution to company revenues.
Many businesses settle for convenience and accept whatever return is offered.
Improving Your Yields To devise an effective investment plan, you need to evaluate your business's specific circumstances. Use historical and projected cash balances to determine how much cash is available for investment and for how long. Maximize after-tax returns. If your company is in a lower tax bracket, you may want to focus on higher yields rather than tax advantages. Compare the yields on tax-free obligations to their fully taxed equivalents.