Establishing Long-Term Financial Control For Enterprises

In the growth stage of an enterprise, they usually start with some simple financial controls, such as reducing the trivial cash cost, or checking whether the expense accounts are correct.

According to us financial expert Wesson, these practices can only bring short-term benefits. MendlowitzWeitsen

If enterprises pursue long-term growth and profits, they should start from the following directions.

1. don't pay cash too soon.

Enterprises often pay cash in order to get the trust of suppliers and creditors. Although they will get good debt, they will also reduce the cash available to the company, which will eventually lead to additional loans.

Take accounts payable for sixty days, for example, in ten days, it is the same as paying within forty days.

Therefore, it is better to keep a little more cash in the scope of flexibility and do not rush to settle accounts payable.

2. increase

Speed.

The quicker the customer gets the goods, the quicker he can pay. This will increase the company's cash and deliver the goods quickly, which will increase the customer's order again.

Therefore, companies should carefully track the flow between customers from ordering and delivery, find out where there are delays and inefficiencies, and solve problems as soon as possible.

3. consider different ways of financial expenditure.

When purchasing capital equipment, manufacturers often use cash in order to avoid the trouble of paying interest.

In fact, if we consider the financial method of long-term investment, we can not only increase profits but also keep the cash available to the company by installment payment and paying interest according to the duration of the equipment.

4. reduction

。

Usually, there are not many products that sell quickly and sell very large.

Instead, it is a slow selling product with a lot of stock.

It is difficult to predict the sales volume accurately, resulting in the production of these inventories.

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5. understand customer's credit.

The best way to prevent customers from deferred payment is to make a report on the purpose of receivables, regularly inspect these reports, and label accounts that are out of date or problematic, and call the customer immediately.

Consider hiring a dedicated person to take charge of the work.

Some manufacturers think that customers do not like this kind of phone call. In fact, as long as they train their staff to respond appropriately and courteous, customers will not be disgusted.

6. aim

。

Despite the manufacturers' attention, there are still some accounts which can not be recovered.

In fact, manufacturers can not give up these debts too early, because some customers have more assets than the company's net worth and still have solvency.

At this point, the company can discuss with this large debtor the way to repay debts and maintain future pactions.

Don't give up creditor's rights easily before you know the situation completely.

7. control salary level.

Personnel cost is usually one of the important expenses of the company. In order to avoid excessive expansion of personnel costs, the company should pay attention to the adequacy of overtime payment.

Excessive overtime may mean inefficiency.

On the other hand, we should pay attention to the productivity of employees.

Can we reduce the number of employees and maintain the same productivity? Can we improve the equipment to increase the productivity of our employees? These seemingly minor items are important practices ignored by many companies.

To make sound financial management and accumulate a large sum of money can accumulate the strength of the company's growth.