We have all heard the phrase ‘cash is king’ or the alternative similar message ‘turnover is vanity, profit is sanity, cash is reality’. It doesn’t matter how many sales you make if they are not profitable, but even more important is actually turning a sale into cash. If a business focuses purely on selling, it will come unstuck if there is nobody making sure the debts are paid by the customers.
Credit control can be undervalued as a resource but it is an essential role which needs to be carried out consistently.
With more businesses now using cloud accounting packages such as QBO and Xero, it should be possible to have the bookkeeping maintained on a real time basis and debts can be monitored as they arise and paid, with no delays.
The proactive businesses are then using apps such as Fluidly to use their QBO or Xero dataset and automate their credit control function, reducing costs and speeding up cash collection. Fluidly can also use artificial intelligence to forecast future cash flow based on historic patterns, without the use of manual spreadsheets.
Cash flow forecasting – together with good credit control, can help a business make well informed decisions about the future eg capital spend; employee requirements; loan financing. We can advise on the implementation of such apps and also assist with the interpretation of the resulting reports.
Don’t let your company follow the demise of an increasing number of failing businesses – collect the cash owed to you and ensure your own liquidity.
Should you want any advice on which platform would suit you, contact your local Haines Watts office or representative.
Want to know more? Call us on 01392 260310 or email firstname.lastname@example.org