The current economic climate is awash with change and uncertainty. These unstable trading conditions have highlighted the necessity for businesses, particularly small and medium enterprises (SMEs), to become more aware of who they are working with.

Businesses are being hit with a range of issues such as supply chain shortages, labour shortages, rising inflation and rising interest rates.

To manage these fluctuating and uncertain risks, it is prudent for businesses to place greater value on the financial health of their customers. Many businesses are now in very different shape to what they were pre-COVID. Customers pose a large risk to businesses selling on credit, particularly during times of uncertainty.

How well do you really know your customers?

Time your cash flow

The reliability of cash flow is one of the biggest challenges for a business as customers can significantly impact the financial stability of your business if invoices are late or left unpaid. It is important to keep tabs on when your customers are due to pay you as these expenses are the reason why your business stays afloat and functioning. The timeliness of your customers’ payments poses a substantial threat to the success of your business.

Automating your reminders and having systematically organised emails, texts or calls set in your diary is an essential part of avoiding late paying customers and maintaining a good and stable cash flow. While following up with customers about their payment due dates can be a time-consuming task, there are many software applications that can automate the process and send these reminders for you.

Inconsistent cash flow limits your ability to cover the cost of materials and labour or plan staretgies and future opportunities for your business. Without this buffer of a steady amount of working capital on hand, your business has no safety net to fall back on during tough and uncertain times.

So how can I monitor the activity of my customers?

CreditorWatch’s automated monitoring tool watches the activity of your customers all day, every day. We deliver key updates to you as soon as they occur, alerting you to any suspicious behaviour or activity likely to adversely affect your business. The monitoring and alerts tool allows gives you back the time to make more informed decisions for your business before you are impacted by your customers financial woes.

In the current uncertain trading environment, it is even more vital to be on top of the status of your customers payment behaviour. There is an increasingly high risk that circumstances can change very rapidly, leaving you unaware and unsure of the impact on you until it’s too late.

It is important to identify whether your customer is maintaining good payment behaviour with creditors as well. Although your business may be being paid on time at the current moment, it may be at the expense of other businesses.

Find out more how CreditorWatch can help you monitor you customers and learn what steps you can take to mitigate credit risk and secure your business cash flow.

Request a demo here today.