WELCOME TO ISSUE NO #022

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📆 Today’s Rundown

Hey 👋, in the last issue, we discussed Why AR Aging reports matter, but now, we are proceeding with Billings & Collections and today’s topic is:

Average Collection Period

Is Your Average Collection Period Too Long? Here's How to Optimize It.

Newsletter highlights

1. 3 reasons why tracking your average collection period matters 🤟

2. Average Collection Period Stat of the Week 🔢

3. My Tool of the Week 📊

4. Latest Week Content Update 🆓

3 Reasons Why Tracking Your Average Collection Period Matters

1. It impacts your company’s cash flow

   A longer average collection period ties up your funds in receivables, making it difficult to pay vendors, employees, or reinvest in your business.

   Monitoring this metric helps you spot potential cash flow issues before they become critical.

2. It reveals the efficiency of your credit policies

   Tracking the average collection period provides insight into your credit terms and collection practices.

   If it takes too long to collect payments, it might be time to tighten credit policies or adjust your billing process to ensure quicker payments.

3. It influences customer relationships

   A prolonged collection period can indicate inefficiencies in your invoicing process or difficulties in customer payment behavior.

   By improving your collection period, you strengthen your financial position and enhance relationships with clients by offering more predictable payment terms.

Average Collection Period Stat of the Week

91.25 Days

On average, it takes a company 91.25 days to collect payments after services are rendered. Tracking and optimizing this period is crucial for maintaining healthy cash flow.

This week’s shameless plug…

Just last week, I made a big announcement.

I launched The Financial Strategy Sessions!

What is it?

• A flexible option to book a 60-minute power-hour session focused on your financial needs

• A chance to dive deep into your business's financial strategy, forecasting, and planning

• An opportunity to optimize your financial systems with personalized, expert advice

• You can now book these sessions as standalone or as part of the 4-session CFO Program

Ready to elevate your financial strategy?

My Tool of the Week

Invoiced

Invoiced is an accounts receivable automation platform designed to streamline the billing process and reduce your average collection period.

It offers:

• Automated Invoicing: Send out invoices automatically, reducing the time between project completion and payment requests.

• Payment Reminders: Automate follow-ups and reminders to encourage prompt payments from customers.

• Real-Time Tracking: Monitor payment statuses and outstanding receivables in real-time to quickly address delays.

What I like most about Invoiced is its focus on automating the entire invoicing and collection process, helping businesses shorten their average collection period and maintain a healthy cash flow.

Latest week content update

Here is the latest week content which

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