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Liquidity action for finance departments today – tips from Serrala


Brian Shannon, Serrala SVP, considers three things finance departments can do right now, to meet the challenge of COVID-19.


  1. Preserve your vendor credit lines.

Get on better terms with your vendors, literally. Pay them on time or negotiate some extended terms where there is mutual benefit. Abandon the 120-days+ payment terms demands of your vendors if you have such programs in place. Arbitrarily setting such terms not only hurts your supplier relationships but could put your own business at risk if the supplier can’t supply. Invest in process optimisation that reduces friction in the Invoice to Pay process by simplifying workflows and automating functions.


  1. Effectively monitor your Accounts Receivable balances.

Receiving and applying cash quickly and accurately can serve to ensure that you are not impeding on available customer credit. Keep a shorter leash on the late payers, and more proactively set Credit Management parameters. Look at new ways to receive payments that simplifies the process by removing impediments for your customers.


  1. Pay closer attention to billing and shipping accuracy.

Your customers are going to get expert at looking for reasons not to pay … don’t give them any. But as is the case with any economic downturn, bad debts and deductions rise. Be prepared with your best possible prevention. For when it happens, and it will, ensure you have a solid case management process and tool to manage the disputes.


Brian goes on to say, some of these actions are short and medium term in duration. Implementing new processes obviously takes time, but by investing in such improvements now you will be setting up your organisation for an improved chance of success in the continued uncertainty. This uncertainty provides an opportunity for placing cash back on the throne as king and ensuring that related business processes and technologies support your organisation’s cash flow needs.


You can hear more from Serrala, one of CICM’s Corporate Partners, over the coming weeks.