USING CREDIT TERMS TO MANAGE YOUR CASHFLOW

USING CREDIT TERMS TO MANAGE YOUR CASHFLOW
Cash is king! This is an obvious fact in the business world but in order to get cash in, most businesses offer credit sales to their customers with the hope of securing their loyalty and getting paid in the near future. But the terms on which the credit is given need to be well defined so that customers know their obligations from the onset.

Credit terms could then be defined as the terms and conditions upon which a seller offers goods and services to a buyer. The terms indicate the expectations of the seller as to when the customer is expected to pay for the goods. A 'Due on receipt' simply means that the customer is expected to pay for the goods immediately when the goods are delivered.

Another typical credit terms is 2/10, net 30. This means that the seller is offering 30 day credit, however an early payment within ten days will attract a cash discount of 2 percent. This kind of term help stimulate sales and cash collection. Customers are encouraged to make early payments because of the benefit of cash discount.

#Quickbooks online is embedded with functionality that will help you manage your #creditterms. Your generic credit terms and the ones unique to each customer are easily set up in #quickbooks and this help when #aginganalysis is performed and it also help to classify invoices into past due, due and current.

#sasng and #quickbooks are to back you up for success in the management of your #tradereceivables and cash.