Business Alert at 9:00am With CVA – Cash Flow Tip
How quickly are you spending money and how quickly are you receiving money?
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A clever but polite invoicing strategy will usually get you a long way but first, ensure your invoices are sent immediately after delivering your service or product. If your invoices go out late, you’re inadvertently telling your customers you don’t really mind if they pay late.
Payment terms of 7 to 14 days seem to be ‘the new black’ for most businesses today so don’t be afraid to review your terms and make changes where necessary.
Don’t be too lenient with your customers either. As receivables age, the product or service they relate to can devalue in your customers eyes so act sooner rather than later.
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On the other side of the scale, always try and negotiate the longest payment terms with suppliers. When money comes in faster than it goes out; your business’s cash flow will significantly improve.
If you communicate often and make your suppliers feel confident that payment is coming, they will be more confident to extend their deadline. You can always offer a split payment too, half now, half next month. It’s all about regular polite communication.
We have lots of ideas to increase your cash flow so keep an eye out or if you don’t want to wait, give us a call, we’re happy to share.
The post Business Alert at 9:00am With CVA – Cash Flow Tip appeared first on Clear Vision Accountancy Group.
