Cash management is one of the most critical aspects to any company’s longevity in the marketplace. No matter how long a company has been in business or how profitable they are, an operation can all go south very quickly if the cash on hand is not managed properly.
The good news is that there are five key things you can do to increase the level of useable cash you can access for your business. These include:
- Customer screening and credit checks
- Issuing prompt invoices
- Offering early payment discounts
- Extending credit terms past 30 days, and
- Invoice factoring
Offering credit is one of the main ways you can attract a customer to your business. However, in order to protect your business and maintain cash flows, you must ensure that the customers you are offering credit to are creditworthy, which requires a rigorous credit check. Businesses that take the time to build a clientele that are known for paying on time will go a long way to ensuring they will be in business for a very long time.
In addition, making sure that your customers consistently receive invoices will go a long way to ensuring that they pay on time. Companies that lag on sending invoices to their customers inadvertently create a cash flow shortfall. It is best practice to send the invoice on the same day the product ships.
Both of these business practices play into the last method mentioned for expediting cash flows: invoice factoring. Factoring receivables or invoice factoring, help address cash flow shortages by allowing companies to sell open invoices for fast cash.
Universal Funding differs from other factoring companies because they provide screening and credit checks for their clients’ debtors and they ensure a consistent invoice schedule. If you’re ready to expedite your businesses’ cash flow call us at 1-800-405-6035 or fill out a rate form for a quick consult