The aftermath of Sandy has left business owners experiencing the storm’s impact: stalled cash flow, anticipated future increase of sales and questions as to how best navigate the short term. Three suggestions or policies to implement immediately are:
1. Anticipate a need for infusion of capital
Review your receivables from a lender’s perspective. How does your business compare as against industry norms? A lender will scrutinize your receivables for three items: concentration (balances owed by one customer), dilution (actual dollars paid on the receivable) and length of payment cycle (days paid past terms).
2. Gear up for increased sales
Refine your credit policies at this time to insure risk follows plans for growth. Extend credit to customers who will pay on terms.
3. Strategize with key clients and strategic partners
A conversation with key clients is necessary at this time. Strategize as to how you can continue to move forward together, get paid and increase business while solidifying your relationship.
