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How to Understand if Trade Debtors Are Damaging Your Business
Manage episode 360914723 series 3012675
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Simply having numerous customers who owe significant debts does not necessarily equate to a successful business. In fact, it can be detrimental, particularly to the cash flow. Therefore, although offering credit to customers can be beneficial, small business owners should understand the potential negative impact that trade debtors may have on the company's stability.
Here are a few insights you’ll hear in today’s show…
Steps to manage trade debtors:
- 1st Step - Understand your payment terms - What are payment terms and how it can affect your cash flow?
- 2nd Step - Send out invoices on time.
- 3rd Step - Chase late payments
- 4th Step - Make sure you monitor your accounts receivable - What are Accounts Receivable?
- 5th Step - Offering discounts for early repayments
- 6th Step - Setting clear credit limits
- 7th Step - Invoice Factoring - What is invoice factoring?
- 8th Step - Build strong relationships with customers
- 9th Step - Consider offering payment plans
Resources:
If you’re struggling to understand the accounting for your business, reach out to Annette at podcast@annetteandco.co.uk and join our Facebook group https://www.facebook.com/groups/915326342418247.
To know more about financial and lifestyle freedom and if you wish to receive updates on all the workshops that will help you increase your profitability and freedom from your business, just head on over to https://www.annetteandco.co.uk/want-our-emails/.
Connect with Annette Ferguson:
Facebook - https://www.facebook.com/UKAnnetteFerguson/
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YouTube - https://www.youtube.com/channel/UCkohh_X-4R5mKfEW9rBQ1qA
Listen to the Podcast - Financial and Lifestyle Freedom for UK Business Owners -
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