1. Be transparent
Discuss with your customer openly and honestly any future business cash flow challenges resulting from suggested terms, if they don’t work for you. If you’re anticipating cash flow challenges address this up front. Don’t wait until your business is hurting in 3 months’ time and you can’t meet an order.
Also, if you’re worried about cash flow challenges, then you’re not alone. We know from Dun & Bradstreet – 7 out 10 business managers believe cash flow will be an issue in the coming months. Chances are your customers may have cash flow issues too, and will be empathetic to your position.
In summary, transparency builds trust. Trust builds relationships. Relationships can retain customers for the long term.
2. Always negotiate
Don’t be afraid to negotiate or suggest a contract adjustment. If you need early cash flow to process an order, perhaps, look to invoice in ‘chunks’ or instalments. You may want to consider offering discounted terms on particular invoices. If faster cash flow means better service or product delivery, explain how they may benefit.
3. “No surprises”
Anticipate and make your customer aware of potential finance arrangements up front. If you are still struggling to get the terms you need, finance partners can be an option.
So, in essence, if you have a good relationship, now it’s time for great cash flow!