3 - Why do you have to give 30 days credit?

3 – Why do you have to give 30 days credit?

Tony’s Tip 3

Why do you have to give 30 days credit?

When I ask the question “why do you give 30 days credit?” Everybody says it’s the way their market works but it shouldn’t be.  Think about it?

If you have a monthly turnover of £20,000 and your customers pays you in 45 days you need £30,000 in cash just to keep going. Get your them to pay in 30 days you need £10,000 less. But you still need £20,000. Get them to pay in advance, you can use their money!

 This is Think Cash!

 So I have to ask again, why set your payment terms as 30 days?

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