Getting Paid on Time: Mastering Accounts Receivable

"Having a healthy accounts receivable is really going to keep the business self-sustained, relying on their own cash flow that's being generated from sales and delivery without having to go out to outside resources."

- Andrea Jenson

Welcome to a brand new episode of the Cash Flow CFO Podcast. Join me for a conversation about an issue that's been cropping up a lot lately... slowdowns with accounts receivable. If you're noticing a delay in your receivables, it's crucial to address it before it impacts your cash flow and ability to meet financial obligations. I discuss some actionable strategies you can implement right now to help get your cash flow back on track and keep your business self-sustaining.

Join me to learn the whole story!

"When you have a prolonged accounts receivable problem, it's going to catch up with you and eventually it could potentially damage your credit ratings and increase the cost of borrowing money down the road."

- Andrea Jenson

Identifying Root Causes and Prioritizing Receivables

Both external factors, like economic downturns, and internal inefficiencies can cause delays in getting paid. I share the importance of identifying the root causes of these delays and how to prioritize your receivables to collect on high-value invoices first. Additionally, I highlight the significance of maintaining open and personal communication with your clients, which can help facilitate faster payments and strengthen your working relationships.

Optimizing Internal Processes

Once you've addressed immediate receivables issues, it's essential to optimize your internal processes to prevent future delays. From improving invoicing timelines to implementing automated systems, I cover practical steps you can take to tighten up your accounts receivable management. And beyond that, I emphasize the importance of clear contract terms and creditworthiness checks to ensure you're extending credit to reliable clients.

Proactive Communication

I also encourage you to be proactive in reaching out to clients with outstanding invoices. Most delays aren't due to malice but simple issues that can be resolved with a quick conversation. By staying on top of your receivables and fostering transparent communication, you can avoid cash flow problems and keep your business running smoothly. If you need more specific advice or templates, feel free to reach out—I'm here to help!

"If your team is doing that confirmation check-in to make sure that the client received the invoice, they can also be saying, 'We also want to make sure that there's accuracy and we're clear on the terms.'"

- Andrea Jenson

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