If cash is King then collections are the keys to the kingdom
This is an absolute tragedy and has caused the demise of so many small businesses. It is also hardly surprising when we consider that at any point of time there is more than $26Billion in overdue invoices owed to Australian Businesses with the vast majority owed to Australian SMEsA client of mine once said that a "sale is not a sale until you get paid". I think that is very wise advice for every business owner and it is the business owners responsibility to ensure that they are paid for what they do in a timely manner.
Too often I have seen businesses that are under enormous cash flow pressure and when I look at their Receivables I shudder when I see just how much is tied up in their 60 to 90 day debtors. When I ask the question as to why the answers are usually pretty similar:
- We follow up our Debtors when they get to 30 days
- Our Admin Clerk follows up but has trouble getting around all of the Debtors
- I get involved when the debts get to 60 days
- There are too many to follow up all the time
- We do not want to upset our major Debtors
The impact of not chasing Debtor payments can be devastating for any business and lead to an unhealthy reliance on Credit facilities like Overdrafts to support the requirements of the business. This reliance leads to a huge growth in Hard Core debt that can manifest itself in Creditor Pressure and ATO arrears, which add up to increased pressure on the Business and the business owner.We now live in a rapidly changing and technically savvy world where there are solutions that can assist Businesses to re-educate their Customers and change their payment behaviour. IODM is a fantastic Accounts Receivable management tool, which fully automates the collection process through the use of Email/Text alerts and the incorporation of a Pay Now and Dispute functionality. In short IODM brings forward the Collection Process by at least 30 days and ensures that there is more cash in the business. By doing this there will be less pressure on Credit facilities and the Business will be able to manage their Creditor and ATO obligations.
Thane was approached by IODM late last year to enter into a reseller agreement and I was delighted to get involved as it is the perfect rounding out of our philosophy which is to find solutions which assist from Purchase Order to payment.Should you or your clients wish to meet and discuss IODM please do not hesitate to either give me a call on 0433 985 843 or at Neil@iodm.com.au or firstname.lastname@example.org
|Tags: SME's Cash Flow Debtor Finance Debtors|