Ultimately, it’s not about spending a lot of time and cash on credit. It’s about making sure that your time and your cash can be invested in those things that will grow your business.
There are four simple ways to improve your cash flow so you can invest in those things that grow sales.
First, invest the time to understand how your bank views your business. Spend time getting to know your banker and make sure they understand your business. Also, keep in mind that most banks get concerned when anything threatens their principal. Loan officers are trying to avoid downside risk and are monitoring for any tripped covenants.
Second, set clear credit limits. If you haven’t explicitly set clear limits, then you really don’t have any. You do need to know upfront what situations will garner a “no” response from your bank. How large is too large a line? Below what credit score an application is declined?
Read the full article to learn more about the four ways you can keep cash flow flush and credit risk low.
About the Author
Scott is president and CEO of BlueTarp. He has spent the majority of his twenty year career in financial services helping businesses grow more rapidly through the effective use of credit.More Content by Scott Simpson