‘Cash Flow Is King’ — I can’t remember where I first heard it, but I bet you’ve heard it too. If you run out of cash, that’s it, it’s over, no more business. In a simple language, debtors are the people who owe you money. Unless you are a bank, don’t act like one. If you’ve delivered what you promised to your customers, you’re entitled to be paid. Stay on top of your Debtors. Any good accounting software program will allow you to produce regular Debtors/ Receivables reports showing overdue amounts and time. You should look at these in detail on a regular basis (at least monthly) and have a formal collections management process that ensures you get what’s owing.
Takeaway: Don’t be someone else’s bank (www.missionmeans.com)