Tag Archives: bad customers

CASHFLOW IS NOT NET PROFIT OR MONEY IN THE BANK

Happy 2016 and I wish you all the best for a successful business year.

Unfortunately the start of a new year is generally followed by cash flow problems. We all at some time have experienced our customers paying us later, down time for us chasing our debtors, and possibly this brings about late payment to our suppliers. NOT GOOD IS IT?

A few tips that you may want to consider, is looking at where your cash flow has been trapped.
# Did you purchase a lot of stock in preparation for the Christmas sales that your business has paid for, but are yet to still sell?
# Did you invoice all your customers prior to taking time off at Christmas time?
# Did you potentially purchase the wrong assets for your business that aren’t helping you to produce income?
# Did you pay your suppliers early thinking to take some new year pressure off?

Put simply cash flow is Money In and Money Out, and delays in Money In and poor decision on Money Out can be the cash flow killer to most businesses.

There is no use grumbling about it, you need to review your business position and get your cash flow moving again and forward plan for next year so that you don’t have the same problem.

New Year New Focus. Let us power your business to the next level!

Posted By : admin ( 01/14/2016 )

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DEALING WITH YOUR DEBTORS

www.creditorwatch.com.au should be your first step in your process for extending credit to your customers.

Why I hear you ask?

ASIC has identified a serious increase in the number of companies going into administration. Why not be ahead of the game and monitor your business money better.

Ask yourself these questions:

Would you extend credit to a customer if you were aware of their credit risk?
Would you risk your business to help that customer if they were a credit risk?

Creditorwatch keeps an eye on your customers for you, you will be sent an alert if there is a change in their credit status.

Recommendations:

1. Before you take on a new customer, perform a free credit check to know their credit worthiness.
2. If you decide to extend credit then provide them with a manageable credit limit in the beginning.
3. Continue to monitor all your customers for changes. Through Creditorwatch you will be able to react sooner rather than later on the credit that you extend to your customers.
4. Put a process in place for collecting payments. You can do this manually through a diary or you can use an automated product that syncs with most accounting softwares.
5. Notes, Notes, Notes as you can see I can’t stress this enough. You need to keep track of your communication process with all your customers. This helps if you have to go to debt recovery on your customers.
6. If you are struggling to get payment out of a customer, send them a final notice letter outlining your next steps including registering a default. Creditorwatch has some tools that you can use for this.

IF YOU HAVE ANY FURTHER QUESTIONS IN REGARDS TO DEALING WITH YOUR DEBTORS PLEASE CALL ME TO DISCUSS.

Posted By : admin ( 09/25/2015 )

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