Exactly how the turmoil on global financial markets will impact the Australian economy is still pretty unclear, but there are a few things almost certain to happen.
Firstly, consumer and business confidence will take big hits.
Consumers don’t respond at all well to bad news and the fact that this current crisis has business on the front page of newspapers again will have a huge impact.
As a result, businesses are also likely to become more cautious, particularly over the next few months.
How will these confidence falls hurt your business? Cashflow.
In times like these, households and businesses tend to hang onto their cash for as long as possible. Bills get paid later and the pressure can mount quickly.
You need to be extra vigilant about late payers. If you were looking at cashflow once a week, review it every day.
Pay particular attention to your list of debtors and refine your process to deal with late debts.
If an invoice is more than a week late, make a call and find out if there is a problem with the bill. Get a firm commitment from the late payer WHILE THEY ARE ON THE PHONE.
If a debt is two weeks late, be prepared to step up action. If a debt is a month late, be ready to refer it to a debt collector.
When in doubt, jump on the phone and get answers. Don’t let your business be brought down by late payers.
Get it done – today!