Are you tightening your receivables?
November 12, 2008
Survey Results for 11/12/2008:
I expected that perhaps window and door companies would revisit their financial policies given the current economic environment. As I said last week, it's going to be important for companies to maintain control over their cash, and massaging receivable terms is one way to try to do that. Still, it's a fine line to walk. Pulling in your terms will put cash in your account quicker, but will you sacrifice sales with customers that expect or need more time?
I've been speaking with a lot of industry players in the last few weeks as I prepare for our annual forecast issue. Companies are streamlining and looking for ways to stay efficient in many areas, including the finanical realm that prompted this poll question. One quote in particular comes from the owner of a dealer and manufacturer located in upstate New York:
"The companies that will survive are the leanest, with probably the best systems. One has to realize that all companies are good at certain areas. If we can’t get better at the weaker areas, those people won’t survive. That includes my own company. We have the same dilemma."