Managing cashflow is intrinsic to business success. It is all about ensuring that there is not a time lag between when you pay your suppliers and when you receive money from your customers.

Therefore ensuring that your invoices get paid on time is at the heart of good cashflow management. The faster you can get someone to pay what they owe you, the less likely you are to get into a negative cashflow situation.

Manage Cashflow Through Account Forecasting

Cashflow management plans are all about projecting what you expect to be paid and when by taking into account your customers’ payment histories.

OnStop can help with this by allowing you to search our database to see if any customer that you are planning to do business with has been blacklisted by another company.

This will help you to identify ‘risky’ customers and to take necessary precautions and measures.

Managing Cashflow By Incentivising Prompt Payment

Since managing cashflow is all about making sure that you have enough money coming in to enable you to pay your suppliers, you would be well advised to try and incentivise prompt payment by your customers.

One way to do this is to offer a prompt payment discount to try and encourage your customers to pay you before payment is actually due.

You could also try using schemes like direct debit to help make it easier for your customers to pay you promptly.

Preventing Late Payments

Being forewarned is being forearmed. Use OnStop to carry out credit checks on new customers by checking their payment history. This will alert you to any potential payment problems before it is too late.

Always invoice promptly and specify on the invoice exactly when payment is due.

Manage Cashflow at the Suppliers End

Another way to help you manage your cashflow is not to pay your suppliers before you have to. In other words, wait until the invoice is due before paying it rather than sending off a cheque as soon as you receive your supplier’s invoice.