Are Your Receivables under Control ?
Running a business can be a bit overwhelming. As an Owner, CEO, there are so many important duties you have to manage. Your Accounts Receivable is one of those duties. When the bills keep coming and the buck stops at you, not only is it overwhelming, it can be downright devastating, if you’re not getting that cash flow in! If your accounts receivable gets out of control and you have no idea how to stop the hemorrhaging, your business could bleed out financially.
The financial lifeline of your business, your cash flow, dictates the health and stability of your business. A sustainable business must have a positive cash flow. If you don’t want to find your business lying comatose on the floor of your heart, you have to take immediate action to address the lifelessness of your accounts receivable. If cash is flowing out and nothing is flowing in, the health of your business will deteriorate.
Before the financial state of your business becomes critical and has to be put into an Intensive Care Unit (ICU), seek professional help. You should consider hiring someone who can assist you in organizing your accounts and put a plan in place for moving forward. A professional can help you put your business “on a budget” by assessing how much credit you should actually be extending to customers for your goods and services. As well as, help you organize and develop a plan of action to collect what’s already owed. It may seem ludicrous to spend money on a professional if your business is suffering financially. However, if your business is in danger of going on life support, you need someone to ensure that the heart of your company continues to beat.
In addition, you might consider taking the pulse of your billing system and process. If your system and your process are antiquated, you might look into upgrading. Old systems of collecting are time consuming and do not encourage customers to pay on time nor does it entice them to pay in full. A great system can be setup to work through automation and free you up to do what you love, run your business! Accounts receivable, the name says it all. These are accounts your business should be receiving money from. Get your finger back on the pulse of your business!
A healthy cash flow will breathe life back into your business. If your accounts receivable is out of control, don’t continue to put it off. It will not heal itself. Your accounts receivable needs your immediate attention. You’ve got the prognosis, now get the tools in place that will restore the financial health of your business.