2009 will be a happy new year for some
Protect your cash flow & watch who you extend credit to in 2009
We are all hearing the doom and gloom story and in a recent article by Paul Strzelecki, Managing Director of Yorkville Advisors UK (read it here) he states that “Next year begins with an unprecedented situation: up to 20 of the OECD nations will be in recession.” Hopefully we are likely to be less affected than most countries but it does pay to be prepared and planning ahead for the new year.
I came across some great tips from the collection agency Dun & Bradstreet to keep your cash flow in order (read it here):
- Develop a cash flow projection and ensure you monitor and update it regularly
- Minimise bad debts through an established credit assessment procedure
- Establish an accounts payable policy at the outset of every credit relationship
- Establish a deposit policy for work in progress
- Monitor your customers’ use of credit and adjust their credit limits accordingly
- Closely manage your invoice process and collections practices
- Rearrange annual payments such as insurance so you pay small instalments frequently. This will help to smooth out lumps in your cash flow cycle
Many small business owners are unaware that factoring companies provide most of the above services mentioned above for a small service fee. If you want to know more contact me by email [email protected]
