Planning Your Accounts Receivable Collections
How long will it take to collect your receivable? This is an important questions to answer, especially when you’re planning cash flow (see my video on Cash Flow Projections). Most businesses have a built in assumption that they will collect all accounts receivable within 30 days of billing and even within that I know I can walk 10 people through their own accounts receivable and they will immediately begin to identify clients who always take longer to pay vs those who consistently pay immediately. Managing your accounts receivable collections a little more closely will help you in a few ways. Shine more light on the clients who consistently pay late Plan your cash flow outside of what the “terms” say Get a better handle on your cash flow and expected…