Cash flow is the lifeblood of any business, representing the net amount of cash being transferred into and out of a company. A positive cash flow is indispensable for meeting obligations such as payroll, vendor payments, and financing costs. Here, we delve into various strategies that businesses can employ to bolster their cash flow, ensuring financial stability and fostering growth. THE CASH FLOW CRUNCH Finance Monthly IGNORE CASH FLOW ISSUES AT YOUR PERIL Issuing invoices promptly and accurately facilitates faster payments. Utilize digital invoicing solutions to automate this process and reduce the time between service delivery and payment. Payment Terms: Establish clear, concise payment terms with clients. Consider offering early payment discounts as an incentive and implement late payment penalties to deter delays. Larger companies will work to their own terms, such as 60 days. In this case it’s important to send your invoice as soon as possible by hard copy and email to the accounts team and then follow up with them immediately to ensure the invoice is on their system, you do not want any company or customer to use the common excuse of ‘I didn’t get your invoice’ this is especially prevalent when invoicing by email only. Also, it’s important to keep a record of those who are deemed to be bad payers and do not work with them going forward. Follow-Up System: Develop a systematic approach to follow up on outstanding invoices, incorporating polite yet persistent reminders to encourage timely payments. QUICK INVOICING: Business Finance Monthly. 46
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