Cash Flow

Controlling credit
 Learning outcomes

By the end of this session:

• You will be able to describe the risks behind poor credit control
management
• You will be able to identify what strategies can be put in place to
control cash flow
 What is cash flow?

Last week
recap
What effects cash flow?
 Cash in v cash out

Cash flow Sales v many bills!

Fixed costs and Variable costs

 • How can we control the cash in?
• Credit control is the key to effective cash flow
management.
Credit control
• Remember "Cash is King"
 Depending on your business models
Will clients use your products once or
regularly?

Clients
How does this effect the way you deal with
clients paying their bills?
Procedures

In groups, discuss
• Why may customers not pay on time?
• Why may customers not pay at all?
 Clients
What is the secret to repeat business?
 What are the main reasons
clients will return?

Customer What are the advantages to

giving excellent customer
retention service?

"Go the extra mile"

Late payments
• What procedures could you implement to prevent late payments?
 In pairs discuss

• What can we do if clients don’t pay at

Nonpayment all?
• And what are the implications of those
actions?
 • Controlling cash flow is dependent on balancing
costs v controlling credit
• Procedures put in place can ensure the clients
know when and how to pay
Summary • Reminders are required when payments are late
• If nonpayment occurs, legal action may be
required.
• Keeping clients happy is critical and essential to
your business.