Your company’s cash flow largely depends on how quickly your customers pay. In most small businesses, those checks tend to dribble in close to—and after—the due date. If you operate on a slim margin, this can have a serious effect causing you to be late paying your own bills.
It’s essential to get incoming revenue moving as quickly as possible. QuickBooks offers numerous ways to help you accomplish that critical goal.
The single most effective step you can take to speed up customer remittances is to allow payment by credit card or electronic check. If you’re currently only accepting paper checks, you already know what problems that option can create, like mailing time, trips to the bank, and insufficient funds.
To establish this capability, you’ll have to sign up for a merchant account that will connect your bank to the financial institutions used by your customers. There are fees associated with this, and the initial setup will be unfamiliar to you. We recommend seeking professional assistance with the initial setup.
Having a merchant account will help to accelerate your receivables and improve your company’s cash flow. There are several other benefits as well. For example:
· Your customers will appreciate the convenience and be more likely to make a purchase.
· In 2018, customers and prospects expect to be able to pay for items and services electronically. Not allowing this affects their perception of you as a forward-thinking, progressive business.
· You’ll save time, which translates to money. Instead of chasing payments, you can be working on ways to meet your goals and help your company grow.
If you’re conscientious about keeping your records and transactions updated, you’ll have access to the most current data about your company’s financial status. You’ll be able to answer questions from customers and vendors quickly and accurately, and your daily accounting tasks will be much easier to accomplish.
There’s another huge benefit, Reports. One of the best things about QuickBooks is its ability to create dozens of reports using pre-formatted templates. Choose the one you want to see and the software will display it using your company’s data. You also have the option to customize these reports extensively, so they contain the exact cross section of data that you want to see.
You can see in the image above that several of QuickBooks’ reports are focused specifically on the status of your customers’ invoices and payments. We strongly recommend that you run these reports regularly. The more you know about who is behind and by how much, the more targeted your collections efforts will be.
You’ll also notice that there’s a category of reports called Accountant and Taxes and Company & Financial these will be unfamiliar to you. They are quite complex and important. We recommend hiring a professional bookkeeper to analyze and report on a regular basis (monthly or quarterly) to provide insight that will help you make better business decisions.
Whether we like it or not, some customers are going to be late on their payments. Their bills may have been lost in the mail, they may have ordered so much that they’re confused about which invoices haven’t been paid, or they may just be low on funds.
You can’t do much about the latter reason, but QuickBooks provides a way for you to update customers about their past due payments: statements.
It’s not difficult to follow QuickBooks’ customization options for statements, but we’re here to help if you run into difficulties. In fact, we’d be happy to sit down with you and talk about these as well as other options for improving your company’s cash flow. It’s a multi-faceted problem with many solutions; we can go over the options with you. Contact us now to work on making the rest of 2018 more profitable.
Exigo Business Solutions | Providing QuickBooks Consulting, Bookkeeping/CFO services, and Accounting Technology Solutions by a team of Advanced Certified ProAdvisor's' using our experience of working with small businesses to positively impact your bottom line. As an Intuit Premier Reseller of QuickBooks technology solution, we are experts in implementing and troubleshooting QuickBooks. Visit our website https://www.exigobusiness.com/ or give us a call at (816)394-6818 for more information.
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