Recovery Plan P6 – Terms Right
Recovery Plan P6 – Terms Right
Last updated: 29 September 2020
Business Owner Update 22nd May
Recovery Plan P6Okay. On the third cash flow tip I have for you today, we’re going to be talking about getting your terms right .Now. we have many, many clients who, before this, economic situation arose before the virus hit and caused all the problems we had clients offering 30 days, 60 days, 90 days…… many, many offering 30 days.A few offering 60 days and some even offering 90 days credit.There were also very few people asking for money up front, asking for deposits.And I think that has to change.Well, actually I know it has to change, but I think I’d like you to consider changing it for yourself and your business.Now, before you sort of say, “well, times are tough….We need all the business we can”.That I understand.And I accept 100%.Business is tough out there and we need to get business in.But we also need that to make a case for getting the right terms to reduce our economic risk of our businesses.Because the last thing we want to do is do the work and not get paid.We don’t want to have to find out somebody else’s cashflow problem.We have enough. ..Dealing with our own cash flow issues.Right?And so what I’d like you to consider right now is look at all your terms of business, you know…How do you sign up clients?How do you credit check them?What terms do you offer them?What deposits are there?What relationship do you insist on and, you know,Make sure you’ve doubled down on looking at your terms, because if you don’t, you’re at the mercy of somebody else’s terms.Now let me, let me just say that…I think I’ve mentioned this in the past……but more businesses fail because of cash flow than because of profits …and you could be taken out through no fault of your own, but through a fault off them…… they could have poor credit checks on their customers and get taken out.Or somebody above them goes down and knocks them.They could be taken down.So you really want to make sure that your business…On its own… does everything it can do to make sure you survive.The last thing you want to do is do work and not get paid.All right, that’s it for my third cash flow tip.
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