03-09-2012, 10:49 AM
Methods to accelerate cash flows
accelerate cash.ppt (Size: 287 KB / Downloads: 40)
Cash budget and forecast
Prepare a cash budget and weekly cash forecast to track actual cash in and out against projected cash in and out.
Purchasing
Centralize purchasing for the firm or at least within major business units.This reduces admin costs
Vendors
Prevent costly supply disruptions which can bring sales and cash flow to a halt. Use multiple suppliers for key items when possible.
Receiving
Ensure Receiving has a copy of the purchase order.
Use standardized processes.
Examine the goods when arrived.
Offering discounts
can be expensive.
calculate the appropriate discount to offer.
The annualized cost of the discount should be less than the company’s incremental cost of capital.
Cut off customers who haven't or appear that they won't pay.
Offer several convenient payment methods
Deposit all payments made immediately
To remind customers when to pay, you need a system to let you know when they are due.
Know when to fire a client.