What you need to know about credit
Mon 8 July 2019 - 3:09 pmAdvice | Cashflow | Featured | Small Business
It’s no secret that inadequate cash flow is one of the main reasons why businesses fail in Australia.
Dynamic Business only recently talked about this issue last week, with new research commissioned by H&R Block found that the biggest struggles for small businesses across Australia are:
- ‘cashflow’ (35%)
- ‘marketing effectiveness’ (30%)
- ‘lack of support’ (19%)
- ‘hiring the right people’ (18%)
This sees cashflow as the biggest reported problem for business owners trying to survive.
If you’re reading this as a small-to-medium business owner, you probably know what it’s like to balance many different job roles. Many SME leaders are juggling the demands of being CEO, Head of Marketing, Manager of Sales, Chief Accountant and many more positions… all at the same time!
While this can be exciting and fast paced, not to mention probably necessary in the early days, it means that no two days for an SME are alike – making it increasingly difficult to forecast and consider future risks ahead.
Credit management is an area easily overlooked due to its complex nature.
Matters such as implementing your debt recovery routines, understanding policies and getting your head around countless credit acronyms (What does PPSR even stand for?), can be overwhelming and hard to navigate through.
You’re a business that wants to get paid and needs to get paid at the end of the day.
However, if you’re already time and money poor, it’s very easy for late payments to really hurt a small business and compromise cashflow. It is essential to have strong credit management in place to perform risk assessments and avoid this.
CreditorWatch has been designed as a subscription-based service to allow businesses to check credit risks, monitor customers and act as an automated accounts receivable team (The A-Team).
Here are some key resources created by CreditorWatch and shared exclusively for Dynamic Business readers. Avoid cashflow problems by reading up on credit and how best to manage credit going forward.
- PPSR Key Terms
- The 6 RE’s of Credit Management
- The Cashflow Train
- Warning Signs: The Road to Insolvency
If you need more help with credit management, you can sign up for a free CreditorWatch trial here.