Title: 4 Tips for Effectively Managing Working Capital - SoftCo
Headings: 4 Tips for Effectively Managing Working Capital
4 Tips for Effectively Managing Working Capital
Blog - 29 Oct 2020
Benefits of Positive Working Capital
Improved Liquidity
Operational Efficiency
Increased Profits
Achieving the Correct Level of Working Capital
The State of Working Capital in 2020
Tips for Effectively Managing Working Capital
1. Manage Procurement and Inventory
2. Pay vendors on time
3. Improve the receivables process
4. Manage debtors effectively
Conclusion
Posted by
James Duffy

Content: Maintaining an accurate debtor’s ledger ensures that you are on top of debtor collection dates and can send timely reminders to your customers regarding payment. 4. Manage debtors effectively
The best way to ensure you have enough working capital available is to make sure money is coming in on time. Reassessing your contracts and credit terms with debtors may be necessary to make sure you are not giving debtors too big a window to pay for goods and services, as this may be impacting negatively on your own company’s cash flow. CFOs should review credit terms with company management to ensure that the level of credit being offered to debtors is appropriate for your company’s cash flow needs. To reduce bad debts, you should implement more rigorous credit checks and ensure that effective credit control procedures are in place for chasing late-paying customers. Conclusion
The Covid-19 pandemic has presented a number of working capital challenges for businesses across a range of industry sectors. Economic uncertainty will continue in 2021 and businesses must look at new ways to finance working capital in order to maintain operations. By focusing on inventory, payables, and receivables organizations will be best placed to maintain adequate cash flow and maintain short-term commitments in the months ahead. If you would like to learn more about how to manage your working capital,