How Accounts Receivable
Can Impact Your Cash Flow
One factor that is listed occurs in all businesses (with the exception of retailers): slow payment or non-payments of credit extensions, known as the collection of its accounts receivables include:
- Competition
- Written corporate policy that includes:
· Terms of sale
· When a customer is truly delinquent
· Collection techniques incorporated
· Support by upper management of its credit department versus sales department
· When a customer is placed on credit hold
· When a customer is placed with a collection agency and sued
- Corporate customer philosophy referring to how a customer is treated
- Size and skill/experience level of the individuals in the credit and collections area
- Lack of computer systems that are conductive to improving cash flow efforts
- Sales support of cash flow as well as cooperation with credit area and their integrity plus incentive to cooperate
- Actual top management support of cash flow, not just a written policy and procedures manual
Reprinted from All Source Business Web Site
This entry was posted
on Wednesday, August 26th, 2009 at 11:28 am and is filed under Cash flow.
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