What is Cash Flow (Cashflow)?Cash flow is one of the most significant factor for a successful business. It is the lifeblood of your business and is used in your day-to-day operation. It is important that the money that goes in is greater than the money that goes out (income > expense).
There is a good reason why you see the sign "Credit is good, but we prefer cash" on grocery stores. Although this was a thing of the pass (because I rarely see them anymore and stores now encourage the use of credit cards), you can still see a lot of stores giving rewards or discounts when you pay in cash. Because cash is important.
In my small ventures as my own personal sales agent selling different products, I often got into trouble of collecting bills. If you try to be too nice, you're going to run out of business.
How to Efficiently Collect Bills
- Give incentives to those who pay early or those who pay in cash.
- Ask for a down payment
- Set a deadline for all your accounts receivables, you can add additional charges for late payments BUT this must be communicated ahead of time so you are clear on the expectations.