Keep The Money Coming

 

If you want to accelerate your cashflow in the recession, it pays to follow the best practice of the Atradius cashflow cogwheel. There are six elements:

1 Credit vetting. A downturn is when customers might hit hard times. Watch for changes in payment behaviour that may indicate hidden problems.

2 Terms and conditions. Make sure you’re supplying goods and services on your terms and conditions, not your customers’. Do this by sending your terms when you accept their order.

3 Invoicing. Send invoices immediately after delivery.

4 Collections. Make a courtesy call before payment is due.

It’s a way to pick up and resolve any problems that may delay payment.

5 Accounts reconciliation. Pay cheques into your bank quickly and keep accounting records up to date.

6 Reporting. Monitor credit management performance.

Identify reasons for slippage and take action fast.

In the flow

If revenue is the energy that powers your company, credit management is the engine that keeps it flowing. The credit management engine acts as a powerhouse, driving revenue and motivation to every part of your

organisation. As your credit management engine becomes more refined and efficient, so your business

becomes more productive and profitable. Good credit management should be a proactive task, starting even before the sale begins.