If you’re a small business owner, these days you’re probably dealing with cash flow issues. Even if your customer base and revenue levels haven’t dropped much, there is a good chance that accounts receivables have slowed. I heard someone say that, for many customers, 60-days is now the new 30. This was funnier when we were talking about pink being the new black.
So, what are you doing about your cash flow? Here are three quick tips:
Customers who see you more often tend to put you on the list of “pay first” when they get money. For the next several months, maybe quarters, spend more time in front of customers whenever possible, even if you have someone else who calls on them regularly.
Make sure salespeople aren’t making sales to people who might not be able to pay you on time. Major companies are among the notorious for taking 90 days to pay; so if you sell to this level of customers, be sure you build that into your pricing and cash flow model.
Stay close to your banker. If you don’t have a close banking relationship, make one this week. Even if you don’t need them, do it anyway. Take them to lunch and tell them how things are going, even if the news isn’t good. Remember, an uninformed banker is a scared banker; and no one ever got any help out of a scared banker.
Someone who knows about cash flow issues is Jerry Silberman, Brain Trust member, corporate workout expert and CEO of Corporate Turnaround. I talked with Jerry on my show today; and he offered his own spin on cash flow, collections, accounts receivables, accounts payables, and even what to do if you get in a real bind. Take a few minutes to listen and leave a thought or a question for me and others.