7 Cash Flow Mistakes Entrepreneurs Make

Expert advice on how to avoid the pitfalls that could cost your business money

Mistake #6: Shipping more products or performing more services when an account is already past due. “That’s another one of the biggest mistakes that business owners make with an account is they will ship more products or perform more service when an account is already past due,” she says. “If a customer needs to place another order it helps you to get paid because now you can let them know you already owe me this money and their account is on hold until this is paid in full.”

Mistake #7 Being too lenient with credit when the customer is a “friend” or family member. While this is a common issue that often has to be handled delicately, Dunn suggests not changing business habits for family or friends. “So if you complete a sale to say your brother, sister or your son’s little league coach or teacher, or somebody that you know locally you have to have them fill out the same paper work as everyone else,” she says. To gain a little goodwill, the business owner may consider offering the friend or family member a little more time to pay or a better discount than the public would receive. “You would make that clear to them so they know they’re getting a little bit of special treatment.”

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