Optimising Cash & Collections in Uncertain Times
The COVID-19 crisis has undoubtedly shone a striking beam of light onto the efficiency and continuity of AR. A majority of companies are likely to be impacted by the loss of customers and significant reductions in debts being paid, due to customer’s experiencing financial or cash flow difficulties. SSON’s COVID-19 Impact on Global Service Delivery Models Survey in April 2020 revealed that in almost 30% of cases, the most significant business impact as a result of the COVID-19 outbreak is a decline in cash collections.
Under normal business conditions, companies primarily focus on the profit and losses – growing the top line while managing the bottom line. Routine back-office activities such as paying bills and turning receivables into cash are often taken for granted. In the current abnormal business conditions, smart companies are shifting their focus from the income statement to the balance sheet, and/or have developed a treasury plan for cash management as part of their overall business risk and continuity plans.