CFO Tip #4 – Accounts Receivable & Accounts Payable
Do your customers have net 90 terms on your Accounts Receivable? Change it to Net 30. Is it possible to negotiate your Accounts Payable from Net 30 to Net 90? Pretty simple right…well you better beat your customers/vendors to the punch just in case they read this too. This ties in with the “Cash is King” point that you’ll see in our next post. If you’re the first to negotiate more favorable payment terms, you’ll also be the one holding the cash.
CFO Tip #3 – Watch Your Expenses
This sounds like a pretty simple piece of advice, but you’d be amazed at how many companies are trying to maintain a certain type of lifestyle in their business rather than focusing on ensuring their survival. (*cough* – banking industry) Cut back on authorized signers on your accounts, take away employee credit cards and make them fill out expense reports, take a close look at your vendors and pay close attention to your expenses for the next 3 months. It’s amazing what most businesses find…
Keep checking back for #2 & #1 next week, or subscribe to our RSS Feed!