Reduce Receivable Days & Increase Payable Days
These two levers, when working together, can have a dramatic effect on the amount of cash in your actual bank account without even increasing your sales at all. Very very powerful these two together.
Lever #8: Reducing your Receivable Days
This is talking about when businesses and people owe you money, setting up systems and processes that claim that money much much faster. We teach six proven strategies for reducing your receivable days. There are one or two that really, really stand-out and just so easy. It’s one of those things, once you see it you’ll go, “Oh, damn, that’s so obvious. Why wasn’t I always doing that?” [If you’re interested in learning more about Financial IQ, Enquire Here with us today.]
So this is a very, very powerful lever. But not on its own. It’s got to be used with the next lever which is lever nine.
Before jumping to lever nine I think it’s important to add that cash flow really is the lifeblood of the business. And without cash, the business can die even if you’re promised a whole bunch of other money. So it’s very very important to get that in. You want it sitting in your bank account you know, rather than someone else’s or another business’ bank account. So, imagine how much you…how that’s going to feel different when your bank account rises. We’ve had some of our clients in businesses that we’ve educated saying that their cash in the bank has risen between $30,000 and $100,000 just between these last couple financial IQ levers. Not by changing anything in the styles of marketing space, but just with the financial IQ levers.
Lever #9: Increase Payable Days
Our next financial IQ lever is our second last one, which is Increase Payable Days. This is talking about accounts payable. So this is when your organization, your company, or you owe money to other businesses. And if you can slow that down as well as getting paid faster, what it does is it frees up the amount of cash in your bank.
This is really a bit of a one-two punch, and that’s why I love these because they work so well together. It’s just so important to get these right. We teach six strategies for this lever too and it’s really about choosing the one or two or three that are going to work best for you to increase the cash in your business.
By the way, it’s a great time to be reading this post as right now we’ve go a quick 30 seconds survey to pinpoint the biggest opportunity available to you so you can focus your efforts on the ‘biggest-impact’ areas to rapidly grow your business. If this is something of interest to you, click here to take the quick survey!