Set up email reminders for invoices a few days before they are due, when they are due, and again when they are past the due date. Accounting software solutions can automatically send invoice reminders.
Fremont, CA: Managing cash flow is nothing but operating expenses and operations, along with sales. Maintaining positive cash flow is essential for the growth of every business. Lack of cash in hand, when needed, is one of the top reasons why businesses fail. However, managing cash flow during times of crisis is not easy. Here are a few tips to ensure positive cash flow during a crisis.
Send out Invoices as soon as Possible
Companies need to send out invoices if they want to receive payments. Be consistent with the invoicing cycle. Sending them out at the same time every month sets clear expectations. If the process is manual and becomes cumbersome, consider switching to an accounting software solution that can automate the process. However, sending out invoices does not equal receiving payments. Cash flow problems can occur due to late or absent payments as well.
More Payment Options
[vendor_logo_first]The payment process can be complicated as it is, don't make it even more complicated for customers. Instead of accepting only card or check payments, take online, and auto deduct payments as well. This encourages customers to make payments promptly.
Send Invoice Reminders
Set up email reminders for invoices a few days before they are due, when they are due, and again when they are past the due date. Accounting software solutions can automatically send invoice reminders. Sometimes, it is necessary to pick up the phone and call late-paying customers, at least to ensure that they received the invoice. These calls require a skill by itself. Consider selecting an employee who is capable of the task or provide them with the necessary training.
Incentivize Early Invoice Payment
Customers are also looking for ways to reduce their business costs. Offer discounts to customers who make early payments. If payment is due 30 days after the invoice is sent, provide discounts if the payment is made within the first week. This increases cash flow. Organizations can also offer discounts and incentives to customers to pay early regularly.
Ask for Deposits on Customer Orders
Custom products or large orders often involve huge risks. Demand deposits from customers for such orders, especially those that have no value to other customers. Ensure that the customers understand the policy and include the same in the contract.
See also: Top Payment and Card Solution Companies
