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Blog posts tagged cash flow

Should I name and shame my late payers?

June 20, 2016 by Guest contributor

Should I name and shame my late payers?{{}}You wouldn't believe how angry some of the entrepreneurs and business owners we deal with get about customers that won't pay their bills. Well, perhaps you would!

If you've experienced a customer that's given you the run-around on payment you'll know just how infuriating it can be. After all, there's plenty at stake - even highly profitable firms can be put out of business when the cash stops flowing.

Is naming and shaming really a good idea?

Social media has transformed how easy it is to make it public just how annoyed you are with a customer who isn't paying their bills. I have seen a fair bit of discussion online about naming and shaming of late paying clients in recent months, but is it really such a good idea?

Trevor Tierney, a sole trader, obviously thinks so. He was so annoyed by late paying customers that he set up a website (called 60 where you can name and shame customers. For a small fee you can log in and report a late-paying offender, and have a look to see who else is there on the list.

Going public with your feelings about your customer might make you feel a bit better - and you could even see it as a public service to help make other business owners aware - but I strongly believe that you should keep your grievances to yourself. There are far better ways to work behind the scenes and bring in the payment, and there are good reasons not to wash your dirty linen in public.

Reasons to be cautious

First, there may be a good reason why your customer has not paid you. They may not have received your invoice or there may be some errors on it that they haven't told you about. How embarrassing would it be to go public, only to discover that there was a reasonable explanation after all?

Secondly, you might open yourself up to legal action by dishing the dirt on your customer. Lesley Kemp, a freelancer from Milton Keynes, tweeted about a Qatari client that had not paid her. As reported on BBC news recently, she was hit with a legal claim of £120k for defamation.

Thirdly, you risk harming your own reputation. Would you want to do business with a company that takes to Twitter or Facebook every time it has a disagreement with its customers?

I do not advocate naming and shaming your debtors. I believe it is almost certain to annoy them and lower your chances of collecting an overdue invoice. If you have a problem with an overdue invoice, why not look for professional outside help instead?

Copyright © 2016 Samantha White, ceo at My Credit Controllers, outsourced credit control and business debt collection specialists.

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How to supercharge your business cash flow

February 15, 2016 by Guest contributor

How to supercharge your business cash flow{{}}A consistent influx of cash is key to running a successful business; but how do you maintain a regular cash flow?

There are a few techniques and sure-fire ways of tackling cash flow; but it's important to remember that it comes down to your individual capabilities around money management and the methodologies you incorporate.

The good news is that there are plenty of things you can do to improve your cash flow and the more of these steps you take, the greater the benefit for your business.

Customer invoicing

  • Invoice customers as soon as the work is complete. If you delay, it suggests that you’re not tight on cash collection; as time passes, customers forget the value that you’ve given them and they are less willing to pay up.
  • If you operate in a service industry, investigate whether you can charge fully or partially in advance.
  • Make it easy for customers to pay you, with online invoices and payment buttons that accept credit cards.
  • For repeat customers, consider using a low cost direct debit provider such as Go-Cardless. This will put you in control of your cash collection.
  • Consider prompt payment discounts, or discounts for payment in advance.
  • Where you extend credit, charge interest to encourage faster payment. You could also consider charging penalties for late payment.
  • Encourage customers to pay by credit card as they will benefit from an interest free period.


  • If you have long payment terms, consider using an invoice financing service such as Market Invoice.
  • Depending on your credit profile, you may be able to obtain a credit facility with a bank to cover cash flow shortfalls.
  • Consider purchasing large items on a finance lease, such as cars or computer equipment, to spread payments over a longer term.

Paying bills

  • Use company credit cards where possible and pay off the balance in full. This can extend your interest-free payment period by up to 56 days.
  • Negotiate longer dated payment terms where possible.

Cash flow analysis

  • Work with a good accountant who understands your business. A skilful accountant can provide insight into areas that may have been overlooked and help you anticipate cash flow problems.
  • Monitor your accounts in real time using a cloud-based accounting tool such as Xero.
  • Produce a cash flow plan for the next year. Consider using Crunchboards for this as it enables you to create different scenarios based on what plans you have for the business so you can see how each one impacts cash flow.

Now that you have a comprehensive list of tips and techniques, it should be easier for you to ensure regular cash flow. Go ahead and revolutionise your business today.

Copyright © 2016 David Gormer, chartered accountant and founder of Square Mile Accounting.

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Three ways your start-up can save money

September 01, 2015 by Guest contributor

Three ways your start-up can save money{{}}

You probably have big plans for your start-up, with an ambitious vision for the next five years. But ideas require investment in order to become actionable. So, how do you save enough cash to turn your dreams into a reality? Here are three ways to save money for your start-up.

1 Budgeting

Do you know how much you're able to spend or do you normally play it by ear? Having a realistic budget in place is essential for saving money for your start-up.

Without a budget, you could be spending far more than your turnover allows. For example, if in one month you spend £1,000 on office chairs, but only sell goods to the value of £500, you'll be making a loss (unless you've had significantly higher sales in previous months). You need to ensure your expenses make good business sense, staying well within the realms of your revenue so that you're making a profit each month.

Your budget needs to align with your business strategy and objectives, in which you'll specify how much profit you can expect to make and how you intend to invest back into your business.

2 Effective bookkeeping

To be able to save money, you need an effective bookkeeping system. This will allow you to keep track of the money coming in and out of your business, and anticipate future incomings and outgoings.

Good bookkeeping prevents you from overspending, and then facing outgoings you weren't prepared for. So, before you go and order new supplies, you'll be able to see how much you already owe suppliers and the taxman that month, what payments you're expecting, and limit your spending accordingly.

Not only does effective bookkeeping help you to spend realistically, but it also helps you keep on top of payments you're due to receive. Forgetting about invoices you've sent out could mean you miss out on prompt payments, which could leave you unnecessarily high and dry.

3 Negotiating skills

After a while, you're bound to find yourself dealing with the same suppliers on a regular basis. But rather than continuing at the same rates, you need to think about negotiating discounts with regular suppliers to get better value for money. You'll often find that suppliers would rather maintain regular business with you at a lower rate, than lose you altogether.

When you build long-term working relationships with suppliers, you should also think about asking for longer payment periods in particularly difficult months, which could be hugely beneficial to your cash flow.

  • These points and others will be covered in more depth during an upcoming free webinar that will take place on 10 September at 2pm. Get more information here.

Copyright © Babington Group, a "training provider offering a range of courses, from accounting qualifications to leadership programmes". Follow @Babington_Ltd on Twitter.

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How to maximise cashflow by using trade and invoice finance - webTV show

November 23, 2012 by Frances Johnson

With business leaders adopting clever business strategies, facing up to the recession has created unexpected opportunities for organisations. A focus on international trade, reshaping culture, outlook and getting innovative about financing has led to companies creating more efficient ways of working.

Research from HSBC Commercial Banking has found businesses with smart finance strategies are both more likely to be predicting growth over the next two years and projecting a growth in exporting- with access to finance, such as using trade and invoice finance being central.

Steve Box, HSBC Head of Trade and Receivables Finance Europe, participated in a webTV show where he answered questions about smarter ways of financing your business. Key topics covered include: How to form formal and informal alliances; maximising cashflow and how to free up working capital and investing assets for growth.

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