Entrepreneurs operating small businesses agree that managing accounts receivable is always a cause of concern for them. These business owners spend most of their time, resources, and energy on expanding their commercial operations. Only then can they ensure the growth of their businesses. The responsibility of raising invoices on the customers fall on their employees. Despite getting several reminders, these debtors often fail to pay their dues in time. Such a situation puts a lot of strain on their meager finances and costs the business, dear!
Larry Polhill – How can entrepreneurs improve their accounts receivable?
America can boast of many popular financial consultants. Nevertheless, very few of them claim the same level of success as Larry R Polhill. He has been in this profession for over 30 years. During this period, he has been able to accumulate a wealth of invaluable experience when it comes to financial management and related areas. The officials of many large companies credit him for restructuring and improving the operations of their businesses. His area of expertise is in the field of asset management, finance, real estate investments, corporate mergers, and business acquisition. He has the honor of occupying the posts of Chairman, President, and CEO of many companies. The names of these companies include Inventure Group Inc., American Pacific Financial Corporation, Cafe Valley Inc., Poore Brothers Inc., and Capital Foods LLC.
In the opinion of Larry Polhill proper accounts receivable management is the first step to helping entrepreneurs improve their cashflow position. Only then can these business owners find it easier to pay their creditors, lenders, employees in time. Moreover, they have the money to deal with any unforeseen financial crisis. He points out the following three tips they should implement to improve their accounts receivable process:
- Streamlining the invoicing process
Entrepreneurs should take necessary steps to streamline their invoice process. They should give clear instructions to their staff to raise bills on their customers after every sale. Moreover, the owners should ensure their employees dispatch these documents to these debtors immediately. Only then can the proprietors expect to receive prompt payments for them.
- Being open to alternative modes of payment
The business owners should have an open mind to accept different modes of payments from their customers. They should give their debtors multiple options to pay off their outstanding dues besides cash. These could be in the form of electronic transfer, PayPal, online banking, plastic money, or cheques. Taking this step ensures the entrepreneurs will get the money due to them on time.
- Offer cash incentives for prompt payments
Entrepreneurs should consider offering their customers cash discounts for paying their dues before their invoices’ deadline. This incentive scheme helps these business owners get the money they need instantly. Moreover, they are able to maintain healthy commercial relationships with their debtors. On the other hand, the proprietors should not hesitate to penalize slow-paying customers by imposing fines.
According to Larry Polhill proper accounts receivable management help to improve the entrepreneurs’ cash flow position. For this, the business owners need to revamp their billing system and provide their customers with multiple payment options. Moreover, they should encourage these debtors to pay their dues on time by offering them cash discounts. Such steps make it easier for the proprietors to run their businesses smoothly without hassles at all!