There is often liquidity potential in accounts receivable from customers. Of course, you don’t want to annoy or even drive away your customers by frequently following up. But customers who pay late receive an additional value that has not been agreed upon: liquidity that you are missing. Therefore, instruct your accounting department to regularly check incoming payments and promptly send a reminder concerning open items.
In addition to this creeping devaluation of your performance and the additional administrative effort you are expected to put into sending reminders, it is important to be able to plan your incoming payments. Therefore, don’t be afraid to address your customers about conspicuous behavior. Often, a discussion at eye level between managing directors or business unit managers can help.
Be happy to offer your customers longer payment terms, but make sure they pay you appropriately for interim financing.
In addition to stricter receivables management, shorter payment terms can often be agreed with customers.