b'BUSINESS MANAGEMENT CSIACompaniesmightalsoexplore requiringbiggerdepositsfrom customers, said McQuaig. Sweeten theincreasebyemphasizing customerbenefits.Maybeyou already have some needed material ininventorythatthecustomercan actuallycomeandsee.Oroffer free early delivery so the customer canmaintainthematerialonsite. Emphasizethatearlierpayment helpsthecustomeravoidhigher prices later.reliable foundation for future forecasts. Whatever the estimates for what lies ahead, businesses canAs for the outward flow of cash, a tried-and-true obviatecashsqueezesbyacceleratingaccountstacticisdelayingthepaymentofmoniesowed. receivableandstretchingaccountspayable.ForGood financial management on the buy-side has theformer,expertsadviserunningregularagingalwaysstretchedoutpayables,saidCespedes. reports. How much do customers owe in incrementsThis is particularly so in an inflationary environment of two weeks, 30 days, and 60 Days? Any growthwhere businesses must pay a lot more attention to in the numbers over time might indicate a steadythe payment cycle.deterioration of cash flow.Stretchingpayablescan,ofcourse,backfire.For Keeping in close touch with customers can also helpstarters, it can mean the loss of the 5% or 10% acceleratereceiptsbyprovidingopportunitiestodiscountsmanycompaniesoffercustomersthat request timely payments and helping spot nascentpaybeforetheirduedates.Itcanalsoresultin issuesthatmaygrowintofutureroadblocks.higher prices for goods and services. Extending Maintainagoodhandleonwhatcustomersaretoo far makes you more of a risk, said Beaver. And doing, said Anderson. What are their future salessuppliers tend to give better prices to customers that activities? Are they encountering problems that mayare less risky. And theres also the dependability affect operations? ofdeliveriestoconsider:Ongoingsupplychain disruptionswillcausevendorstofavordeliveries Not all customers are of equal importance, and itsto customers that pay on time or early. The cost of smart to concentrate efforts on the most profitable.not having essential materials can be greater than Accountreviewscanidentifywhichcustomersthe interest cost required to borrow money to bridge should receive the most attention. So much of thecash gaps.important information required to monitor cash flow is tied to a selling cycle which varies by customer,Mitigating Costssaid Frank Cespedes, Senior Lecturer at HarvardIn an inflationary environment, suppliers of goods BusinessSchool.Somebuyerssayyesornoand services tend to raise their prices. And higher whenyoumakeacall;othersrequiremultiplerates of inflation tend to make the increases bigger. iterations of proposals. Some buy what you have inWhen inflation is 2% everything tends to increase inventory; others require customized items. Thosebythatamount,plusorminusalittlebit,said things affect the time to receive cash and the costConerly.Butat7%inflation,say,pricestendto to fulfill orders. Good account reviews unearth thatincrease by that amount plus or minus a lot.information.Businesses should try to get readings on anticipated continuedpg.29csiaonline.org'