5 Best Practices to Boost your Account Receivables

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Accounts receivable is an account used to track revenue generated but is yet to be received. It is the money owed to the company from the debtors and is considered assets of the business. Simply put, receivables are the sales that have been done but haven’t been paid for.

Timely collection of receivables is important to the financial stability of a business. Cash is the king and if you don’t maximize your inflows it has serious effects on working capital of a firm. So effective account receivable management is needed to be done or you can instead rely on AR Outsourcing. Anyway, here are few tips to boost your cash flow:

 Do Your Homework before giving credit

When a business is negotiating a credit deal with a customer, it is better to get credit reports from the customer done. If you are dealing with a B2B customer, you can look for their business information report to get an idea of their creditworthiness. Knowing your customer in advance will help you decide the kind of terms to offer to the client. It also saves your future hassles of Debt Collection.

 Streamline Your Billing Cycle

Many companies still follow inefficient manual invoicing and payment processes. Streamlining your billing cycles is important so that your customers have no excuse for their late payments. The correct invoices are also helpful if you are employing 3rd party debt collection agency.

It is important that your customers get their statements on time so that they have a clear picture of their obligations. You must make it easier for them to pay with multiple payment options from credit cards to electronic transfers and mobile payments.

 Encourage Customers to Pay on time

A way to boost your accounts receivable is to incentivize customers who pay on time. Sellers can offer customers who pay promptly varying discounts based on how much in advance they make their payments. The prospect of paying less always encourages customers to go for advanced payment.

 Use Factoring Services

All businesses need a constant flow of cash to meet their immediate cash needs. One solution to boost your account receivables is use factoring services of a bank or any other financial institution. Factoring means to sell your accounts receivable to a third party for a discount.

 Outsource Account Receivables Management

Most companies don’t want to consider account receivables outsourcing, but hiring it is better to hire professionals who can handle your receivables. Not only will they help with advanced billing solutions, payments options and more but AR outsourcing also assist in bad debt collection. Besides this allows saving money and time for you to instead focus on your core business.

Mistakes you should Avoid for Maintaining Smooth Cash Flow

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All winning business homeowners apprehend that effective credit management may be an important part of success. It goes while the not expression that if a business isn’t being paid on time, its income is going to be severely affected and also the associated issues will quickly increase. But, despite knowing the importance of an efficient credit management strategy, several businesses are still creating some killer mistakes which will be simply avoided. Here you may discover ten common credit management mistakes and find out how to avoid them to make sure your business’s success.

 No dedicated credit controller

Not all businesses have the capability or demand to use a credit controller in-house, exploit existing staff to require on the task though it’s not in their space of experience. Not solely will this take time aloof from your staff’s primary roles, they most likely won’t be obtaining the simplest results doable.

  Unclear payment terms

Unclear payment terms increase the probabilities of your client missing a payment date. Higher still, give an explicit date that payment should be received by therefore there's no area for dispute.

 Superannuated terms and conditions

With businesses perpetually dynamic, failing to review and update your may be holding your business back. Take the time to frequently review however you are operating and modify your processes consequently to boost your money position.

 Not knowing who handles payment

Often once coping with giant corporations, the person you're corresponding with isn't the person responsible for paying you. Ensure once causation the invoice you address it to the foremost relevant person.

 Not invoicing right away

Any delay you create once invoicing can offer your client associate excuse for stall payment. As before long as your product or services are provided send your client associate invoice.

 Creating errors on associate invoice

Everyone makes mistakes. However, a blunder on associate invoice could lead on to disputes on payment and be expensive for your business. Perpetually see to it for synchronic linguistics, writing system, and mathematical mistakes before causation to your client.

 Not giving a variety of payment choices

It’s perpetually sensible to provide customers a selection, therefore wherever doable attempt to supply a variety of payment strategies and ensure these are clearly expressed on your invoices.

 No strategy to take late payment

The longer associate invoice is outstanding, the more durable it'll be for your business to gather. So, clearly come into being a day-by-day strategy and ensure you train workers fittingly in order that all stages are adequately completed and meticulously stuck to.

 Failing to credit check new customers

Less than half businesses credit check their customers that may mean they’re giving credit to businesses WHO can’t or won’t pay. Credit reports enable you to instantly check a corporation or director’s credit rating online, permitting you to form fast, conversant choices regarding who you are doing business with, reducing the chance recently payment.

 Failing to credit check existing customers

Credit checking ought not to be a happening event once the primary order is placed – it should be associated with progress task. Even the foremost reliable customers might have a modification in circumstances that may have an effect on their ability to pay on time.

How to Survive as a Startup?

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Every business has its startup phase which is extremely critical and important. Even with the best ideas and contacts in the world, the entire concept can be a lost in a veil. It needs a lot of careful management, planning, execution to get your New Startup from the ground and running even more hard work to maintain it. Even though the business concept is viable and based on sound market research, there are a number of recurring factors that are necessary when it comes to kicking off the startup. There are many cons that need to be headed and addressed in order to streamline the startup process. Here, is discussing the three common problems that can lead to the premature end of a new start and at the very least impact its long-term success.

Improper Management:

Every entrepreneur love to run their own business and not everyone has what it takes to be a successful business. The quality of leadership could lead your business into a great deal of difficulty. But the best part of a startup is that whatever you lack in your startup, you can take it as the outsourced services. There is an employee or company which could help you to get the task done in a professional manner. There are many business owners who are shy away from seeking the help from outsourcing companies and they are afraid of looking daft or an unwillingness to delegate the tasks. Here, the important thing to remember is that you cannot and do not need to be an expert at everything. It is absolutely okay to ask for help. For attaining the perfect management, it is necessary to identify your weakness and recruit the right people to fill these gaps. If you are not in a position to take on employees, you could benefit from outsourcing important tasks to the experts instead.

Cash Flow:

Getting the proper cash flow is the hardest part of starting the company. While getting this right is important for businesses at any stage of their development. It is vital for any startup to maintain the flow of incoming and outgoing cash. You need to Collect the Payment as soon as possible and delay the payment as much as possible. Yes, it is not going to be easier either with business costs and widespread late payment to put pressure on cash flows. Thus, you need to keep a close eye on your income as well as expenses through a cash flow forecast. This will not only give you an indication of when you might experience a shortfall but even show you how you can take necessary steps to maintain the cash flow stress.

Take Financial help, if Necessary:

Maintain the Cash Flow is extremely important, so it is advisable to take any financial help for the business. You can check out the specialist business lending through the likes of invoice finance, asset finance, and crowdfunding. Such funding facilities enable your startup to access money to achieve specific requirements to improve access to working capital to buy new assets or to manage the cash flow.

How to Maintain the Relationship between the Clients and the Company?

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For some reason, the defector relationship among credit professionals and sales representatives at firms tends to be hostile. Over the year, a rift was caused among these 2 teams and its command sturdy for years and among several, several firms worldwide. Though this has given the impression to become “tradition”, it's really terribly damaging to the well-being of the corporate.

While not a decent operating relationship between the credit and sales division, it doesn’t matter what number new deals are oversubscribed. As a result of the Credit Department which will be ready to collect the money required for the regular business operations. Creating or fixing a relationship between the credit and sales division won't be simple. You'll produce processes and continue them to make sure everybody within the departments is becoming on. Below are some nice ways that to induce began to repair the link between credit professionals and sales representatives.

Whenever a replacement rent arrives otherwise you are initial operating to fix the department relationships, send the email out setting your expectations. Decide that department can handle that a part of the sales and credit cycles therefore, there's no confusion. Set your expectations on however they're going to conduct their relationships, therefore, there's less drama.

Advantages of maintaining the relations:

Send out a daily email to the sales division concerning customers with credit holds or order holds. Keeping them within recognizes can permit them to cite these problems in their next speech communication with the client and take a look at to come back up with an answer. This may additionally facilitate to make trust with the credit team since the sales folks are going to be alert to why their client isn't receiving their orders. If a very difficult account comes up, decision the sales division to debate the problems. They will be ready to provide a useful purpose of reading since they need a special relationship with the client. They will even be ready to settle the problems on their finish.

If you're victimization email and decision scripts in your credit department, invite the sales departments to facilitate. Sure phrases could also be taken negatively with the purchasers that you simply could also be unaware concerning, like “credit hold”. Participate in regular sales conferences. Here, you'll be able to review the insecure accounts. You'll be ready to be clear to the sales team on what you have got done to undertake and mitigate those risks, which is able to facilitate them to make an inspiration for the each of you to deal with the difficulty with the client. Encourage the credit department to be proactive. If the sales representative forgot the add vital data concerning the shopper, they shouldn’t ignore it and say it's “not their job”.


Finally, visit with the salespeople. If your company is hosting the outing or vacation party, get to grasp them and build a private relationship. Raise them for his or her opinion on the Credit Department and areas they will see improved.

How to Secure your Business with these Simple Hacks

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As any business owner is aware of, the construct of trust in client relationships is important to your selling strategy in terms of building your whole. While they have to be ready to trust your company enough to settle on your merchandise or services at the terrible start, you would like to be ready to trust them once providing to produce those merchandise or services on credit terms. Sometimes, putting an excessive amount of trust in your customers might hurt your business within the long term, even as saint Dark, founding father of Custom Planet, found when he began the business providing 30-day payment terms to all or any customers: “We were owed such a lot cash that it unfit our income and nearly place North American nation out of business,” he told Real Business. “Things became extremely serious once a number of the businesses that owed North American nation cash went bust and didn’t pay in any respect.”

Credit checking clients could be an unremarkably used technique so as to offer businesses a higher plan once deciding whether or not to trust your customer with credit terms, however once and the way typically ought to they are used? The impact this had eventually caused income to dry up, rendering the business unable to pay suppliers, additionally to wage cuts and a freeze in hiring.

Regular credit checks

When taking up a brand new contractor agreeing to provide a brand new client with longer payment terms, a credit check at this stage is nice to follow for any business and is sometimes a pre-requisite to provide. But, once the client makes another order many weeks or months down the road, it’s vital to recollect that their credit rating might have modified, given it's in a very constant state of flux.

They do this by light any potential threats, like whether or not your client has any County Court Judgments in situ since you began to supply them, similarly as their credit rating, providing you with a decent indicator of however they still perform financially. Credit Checking they often can thus make sure you are up to this point with all the facts close your customers, providing you with confidence in your call over whether or not to trust and provide them on credit terms, supply shorter terms, or maybe even refuse to provide altogether. This will assist with the rejection recently payment and debt, guaranteeing your business doesn't suffer from the cruel reality and negative effects late payment will wear your income.

All it will take could be a single late payment for your customer’s income to suffer, that may get passed on to you, thus certify you retain an in depth eye on your customers to safeguard your own position. That’s why, significantly within the current unstable economic climate, performing arts regular credit checks can facilitate to safeguard your business’s finances and make sure you don’t fall foul of the negative facet of trust.

Running a Home Based Business? Here are Risks You Need to Avoid

home based business

Running a home-based business is a luxury that allows the perfect work and life balance. If you are running a home based business , then you are not alone as there are 60% of traders across the Great Britain who are operating their businesses through their comfort zones. Besides, the small and medium enterprises across the UK are holding more than 99.9% shares in the private sector market. That means more than 3.3 million business owners are operating their businesses from their homes and they offering a great part of a contribution to the entire economy.

Operating a business from home indeed has its own advantages like flexibility, no dress code, no additional costs, and the best one, work-life balance. But still, every business has its own advantages and disadvantages as so do the home-based business. Here, we are considering the risks that can be avoided while running a home-based business. By avoiding the risks, you can not only maintain the profit but even stay ahead of the game.

 Miscalculation of Cost:

There are so many business owners that are overestimating the profit and underestimating the cost of starting up. There are several charges that should be included in the costs while operating the business from home. Like the rent and the utility, a charge will be a well-known factor, but there are other factors that needed to be planned for like health insurance, self-employment taxes, taking business services like web development, digital marketing services, and many others. While calculating the cost, don’t forget that you need to cover more than your salary and you need to take into account the additional expenses that are faced by the conducting business operations like the travel expenses, insurance taxes, outsourcing costs are named to few.

 Not considering rules:

There are some rules and regulations for residential properties that are under certain laws. How the property can be used and may ban certain operations in order to maintain peace and prohibit nuisance in the locality. Thus, you need to talk to your local authorities before planning to run your business from home. Make sure you have necessary permit to operate the business from your home. If you are living in a rented home, then talk to your landlord and check the tenancy agreement to make sure you are not breaching the contract.

 Protection from Cybercrimes:

The popularity of internet increases, so do the cyber crimes. Cyber attacks are usually common these days and getting your website and business information secure needs a heavy price. There are around 62% of cyber attacks that are specially targeted to small and medium-sized businesses and they are less likely to have the necessary resources to ensure the security of data. This makes it more difficult for unscrupulous criminals to access and steal your data by using complex passwords and two factors on all business accounts. Thus, you just need to include the antivirus software on a regular basis and keep your operating systems and software up to date.

 Proper consideration of home insurance:

If the business owners are thinking that their home owner’s insurance covers their business operations, then they are misunderstood. There are some policies which are offering limited coverage for business properties. So, this means that you could be a liable person if a business delivery slips in a way into the property. Thus, make sure that you have a business owner’s insurance policy which will combine general liability and business property protection.

Tips to Make Most of the Currency Exchange Rates for Small and Medium Enterprises

currency exchange

With the advancement of the Internet, the world has become one platform for the businesses. The business owners are nowadays used to trade across seas and have outreached the global market. On the other hand, people are even tending to buy their desired products right from any corner of the world. There might be an average armchair shopper who browses online and orders goods from different parts of the world. While businesses over different countries are now redefining the options of selling their products or suppliers to overseas customers and extending their customer base, business owners are even finding it really easy to source suppliers from foreign companies. It drives the costs down and makes it easier to keep their prices lower for the potential buyers.

Businesses that trade and deal on an international level always need to take their financial aspects very seriously. While trading overseas, the currency fluctuates as the exchange rates change from one hour to two. And the exchange rate can have dramatic changes in the values and can have a dramatic effect on the profits of their businesses. But, here we are sharing several tips that can help business owners keep up to date with the current ongoing with the international money markets. Thus, by following these guidelines you can keep your profit line stable for most of the time.

  • Convert Euros to US dollars rather than Pounds

  • If you have a sterling account, you will need to convert any foreign currencies as you do business and the bank can take a hefty cut of profits in the shape of fees. Right now, both the dollars and Euros are the heavier against the pounds so Euros can be used instead of sterling to buy stock in USD. But you need to consider the FX charge for Converting the EU to USD. The conversion rates right now mean that using EU is the most cost-effective than using the Pound.

  • Use international transfer service

  • The new online nonbank international transfer services are getting trendy these days and they are providing an attractive option for the business owners to pay their suppliers. These services let you personalize the foreign exchange service and you can aggregate the best prices form regulated currency suppliers at every fifteen seconds. This will even provide you with a fast, safe and same day transfers.

  • Maintain currency hedging.

  • Brexit is on widely awaited by the world and at this moment, many of the mini-multinational businesses are preparing the currency risk management plan. But there are forward contracts that will enable you to buy one currency in exchange for another at a specified date in the future at an exchange rate agreed upon today. This currency hedging will allow businesses to plan ahead and create a safe and secure network in order to maintain a steady Cash Flow. Lastly, you need to work with experts who will keep you update on the market movement in order to maintain the flow of cash and level of profit.

    Learn the Customer Trends to Drastically Reduce the Credit Risk in B2B Market

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    For any business, identifying the credit risk is the vital element to achieve its goals. The company needs to predict the cash flow which will allow it to make important and strategic decisions when it comes to the operations and competition. In this fluctuating economy, where there is cut-throat competition, it is essential to remain proactive for the companies rather than reactive. When it comes to financing functions like AP and AR, there are many companies that are still operating in a traditional way and relying on manual paper-based invoice and submissions and receivables. It is essential to digitalize the AR functions of the company which will streamline each step in the transaction process. This even offers a greater guarantee of accuracy through the elimination of manual intervention.

    For the companies in debt collection industries, it is liable to learn the customer trends to drastically reduce the credit risk in the B2B market. The companies can generate credit report about the customers in order to view the past payment history, revenue and outstanding obligations which the credit report will include after deriving the information from the analytics and database. This limited information is enough to decide on whether or not to extend the credit limits of a new customer.

    Besides, there are three real-time factors that are involved in the credit risk. The companies need to check out the visibility, analytics, and resource that can provide a reliable credit risk assessment. The companies can use an automated AR solution to ascertain that provider has deep expertise and talent in the areas of technology and accounts. Lastly, you cannot separate risk for the business. It is a natural part and being able to reduce that will be more important in this competitive era.

    Top 10 Strategies to Boost the Debt Collection

    debt collection

    The companies want to update their accounts at the end of every year. Most of the companies wait until an invoice is past due before taking any action. Here, we are sharing 10 top strategies to boost up the debt collection and to speed up the collection processes.

  • The company needs to update its AR management software, as ineffective system slows the process and fail to provide intelligence requirements to improve credit to cash.
  • Reevaluate the lockbox placement. The studies should be done periodically in order to determine if they are placed in the optimum location for collections.
  • The company needs to review the policy regarding billing dates and the process of collecting debts. Make sure that the invoices are emailed regularly with the necessary information.
  • Check out the technology the company is using to interact with the customers. Whatever technology the company is using including email, faxes, electronic bill etc. should be appropriate for the organization and for the customers as well.
  • The company needs to discuss the terms with the buyers at the time of sale by making sure that they are also agreed to the terms and conditions.
  • Make it easy for the buyers to pay you. Although it is a general thing, this general element is completely overlooked. The company needs to offer all the standard payment options.
  • Ensure that the invoices have all the correct information including the postal address, contact number, and email addresses. Use invoices that make it easy for the customers to understand, remit as well as easy for them to keep a record of the invoice and payment.
  • Observe and review the experience with the late paying customers, as it will provide you with the relevant and current information you need to stay on top of the accounts.
  • Review the company’s overall process to see if you can alter any process that you can tighten up to speed up the payments.

  • By implementing these vital strategies, you can improve your billing as well as the collection of debts. You can even speed up your money into the bank.

    Diversification of Credit Risk for People with Fixed Income

    credit risk management system

    The tension in investment decision making is between the risk and its return. The important perspective is that in the reach for yield, the opportunities for missteps are countless. The long-term rates are unlikely to rise and there is an ongoing opportunity with the fixed income market. Lately, the Calamos product management and analytics team are being asked to consult on fixed income allocations that are heavily tilted towards the credit risk.

    According to the Calamos Vice President and Team head, Shawn Park, “Many products generate meaningful yield but they must reach for it in lower quality credit, often overlapping with allocations specific to high yield and bank loans. There is also a heavy dose of securitized overlap.” Furthermore, he added that “While securitized products provide a yield advantage over investment grade quality, over diversifying in assets class is not recommended.” Besides, bank loan funds, which are also known as the floating rate funds have applied now due to the rising LIBOR. The park reminds advisors that are the types of funds arrived from volatility and potential for larger drawdowns. The bank loans are highly correlated to the credit spread cycle and the credit risk is the primary risk to the bank loans.

    In addition to this, there are market trends that are based on the current market conditions and constitute the judgment. These factors include estimates, forecasts, and statements of financial market and opinions that are subject to change without notice. The views and the strategies described may not the suitable for all the investors. For the reference to specific securities, assets classes, and financial markets all are for illustrative purpose only. These are not resulted to be and should not be included as recommendations and suggestions. The main risks of investing in the market neutral income fund involve around the equity securities risks, which consist of market price declining in general and convertible securities. The risks consisting of the potential for a decline in value during the period of rising interest rates and the risk of the borrower to miss payment synthetic convertible instruments risk, covered call writing risk, short sale risk, credit risk, liquidity risk, and many others.

    The current performance date which represents the past performance displays no guarantee of future results. The current performance may be lower or higher than the performance quoted. The principal value and return of an investment will fluctuate so that the sales and the shares may be worth more or less than their original price when redeemed. The performance reflected at the NAV which does not include the fund’s maximum front-end sales but had been included in the fund’s return.

    The Morningstar market neutral category reflects the investment attempt to eliminate the risks of the market by holding half of the assets in long positions in stocks and the remaining half in short positions. It represents the fund that invests primarily in floating rate bank loans instead of bonds. So, in exchange for their credit risk, they are offering high-interest payments that generally float above a common short-term benchmark. Thus, before investing into any bonds and shares, you need to carefully consider the fund’s investment objective risks, expenses, and charges.