How Being A Good Debtor Can Revolutionise Your Business

How Being A Good Debtor Can Revolutionise Your Business

Article credit: Sage 

Every business owner or manager knows relationships with customers and/or clients are central to what they do. A happy customer or client is the most valuable asset.

But I’d like to suggest there’s another kind of relationship that business owners should cultivate and that can pay huge dividends if handled correctly. I’m talking about the people or organisations to which you owe money, such as your suppliers or creditors.

This might sound counter-intuitive. Why invest effort?

But there’s some solid wisdom and it goes far beyond simply managing your cash flow and balance sheet, or keeping your credit rating healthy.

Working to create a good relationship with those to whom you owe money can bring substantial intangible benefits that nonetheless have a real impact on the performance of your business.

By being a good debtor, you can also become a trusted customer or client, and receive the benefits therein. In this article, I will reveal why.

Big benefits

Think about it. Don’t you have your own natural bias towards the customers or clients of your business who pay regularly, and within the terms, without fail?

Aren’t they the customers for whom you’ve always got time when they call or email? And, of course, aren’t they the ones with whom you’re happy to do further business—perhaps even at a preferential rate just because they’re reliable and hassle-free?

Customers or clients who are tardy in their payments and demand constant attention are expensive to a business in terms of resources.

Why spend your valuable time chasing payments, or the time for your staff, when you could be focusing on the core tasks that you enjoy and build the business in the process?

So, why wouldn’t your own suppliers or other creditors view you preferentially if you not just stick to the rules agreed, such as terms of payment, but also actively seek the smoothest relationship?

Here are some benefits to being a good customer:

  • Superior negotiating power: Creditors measure good customers through credit ratings and businesses use this to their advantage to negotiate the best interest rates on financing. However, a good customer is also best placed to negotiate the very best prices from suppliers—not just when placing that initial order but renegotiating at any time to take advantage of this “good customer collateral” that’s been built up.
  • Better terms: If you can demonstrate that you stick to the terms agreed during each payment cycle then you’re much more likely to be able to negotiate more favourable terms moving forward. Think about the benefits to your cash flow if you could switch from 30-day terms to 60 or even 90 days. The cash could be freed up for that important equipment investment, for example, or even to fund expansion plans.

It’s not even as if you have to try hard to stand out against the competition when it comes to being a good customer. Late payments are depressingly common.

According to research by Sage, more than a third of businesses have no reason for late payments. Meanwhile, 22% of respondents in the survey said they only pay invoices at certain times of the year.

How to be a good customer

Ok, so I admit all this talk of becoming a trusted customer is all well and good, but how do you go about doing it?

You need to have full visibility into your business finances. More than this, you need to transition your processes and methodologies so you’re always prepared to take advantage of this visibility because it really is one of the key lesser-known weapons in today’s competitive business world.

Again, this is more than merely monitoring your balance sheet every day, or knowing your cash flow situation. It’s about having fine-grained insight into just about every aspect of your accounts payable and receivable, whenever you need it.

It’s about seeing this data presented in a way that’s accessible and easy for you to understand and digest within seconds.

If you’re looking to get better rates from one of your suppliers, for example, wouldn’t it be great to see instantly the dates and amounts paid to that supplier over the past year?

Wouldn’t it be useful to contrast those figures against your total outgoings or other suppliers to see what kind of benefits could be had from renegotiated prices and terms?

What we’re talking about here is the use of business intelligence (BI) tools, such as financial reports and dashboards.

Once the preserve of large businesses, nowadays even the smallest company can take advantage of BI within their accounting software. And considering that doing so can be revolutionary, there’s really no excuse not to.

Digging into an example

Below you can see an example of an accounts payable dashboard and information for a fictional bicycle retailer. Of importance is the number at the top left. This is the Creditors Days figure, and it shows as 181.44. It’s in the red.

This means that on average, the company is paying its creditors every 181.44 days compared to the average credit terms of 32.59 (listed beneath in the goals figures).

accounts payable dashboard and information for a fictional bicycle retailer

Clearly, this isn’t healthy, and not conducive to becoming a trusted customer. More information is needed. The business owner needs urgently to know the who, where, what and when about these payments.

If we move across to the Due By Age Summary graph, we see the total amount outstanding to creditors, as well as for how long it’s been outstanding.

In this example, we’re able to see straight away there’s $251k sitting in the Older Than 120 Days column. By clicking this, the owner can drill down into this summary and view how much is owed, and to whom, as well as the number of days the amounts have been outstanding.

accounts payable dashboard and information for a fictional bicycle retailer

The owner will see that most of the outstanding amount in Older Than 120 Days is split between two companies: CycleGo and MountainPro.

If they then right-click on the specific supplier and click on Drill Through, they’re able to immediately drill down to the specific supplier information.

For example, they’re able to determine who the contact person for CycleGo is, and what invoices are due and overdue.

Looking at this dashboard, they may realise there was a whole lot of stock that was sent back, which hasn’t been adjusted yet by the supplier. This explains the massive amount sitting in the Older Than 120 Days column.

Conclusion on being a good debtor

Good business advice for business owners or managers has always been to keep on top of the balance/profit and loss sheet and to know the cash flow position at all times.

But this advice is out of date in our modern world.

Businesses generate data on a minute-by-minute basis and this should be exploited to provide insights that bring real business benefits in terms of improved customer and client relationships. That, in turn, brings better negotiation potential.

As we’ve shown, it would be a mistake to believe this is about delving into arcane terminology or technologies.

With business intelligence reports and dashboards, the information is right there and is easy to understand by just about anybody. Digging down into the data is as simple as clicking or tapping on graphs or tables.

With this kind of power on offer, why wouldn’t you take advantage of it—and revolutionise the way you do business?

About Us
Kiteview Technologies (Pty) Ltd was founded in May 2010 to provide the Sage Evolution Business Management solution to the SME market. The management team of Kiteview have combined +30 years of experience in the delivery of small to mid-market Financial & Business Management solutions. This experience, combined with a sound project implementation methodology has helped in Kiteview’s growth, becoming a Platinum status partner for SAGE Pastel within just 1 year.

Contact Us

For An Obligation Free Quote

Reference For SSVS Payments/Collections Must Be Numeric – Message On AP Defaults – EFTS Tab

Reference For SSVS Payments/Collections Must Be Numeric – Message On AP Defaults – EFTS Tab

Article credit: Sage 

This article explains how to resolve the problem that prevents you from successfully saving the SSVS Payments/Collections EFTS layout type on the Accounts Payable Defaults | EFTS  tab screen.

SOLUTION:
  • Go to Common | Maintenance | EFTS Layouts and open the SSVS Payments/Collections layout type
  • Change the name of the layout, e.g. SSVS Payments/CollectionsNEW

Renew2

You should then be able to successfully select and save this layout on the AP Defaults | EFTS tab

Disclaimer: These articles refer to possible solutions and a platform to share information. Each article describes a method that solved a query (knowledge gathered from previous sites) and how Sage Evolution should operate. These articles make reference to a specific Sage Evolution version, however the thought process can be generalised. Please note the information contained in these articles should be treated as guidelines and adapted to accommodate differences in business processes and IT environments. Articles may not be applicable to all environments. If this article did not resolve your query please contact Kiteview Technologies Support Department on:  (+27) 010 005 6678.

About Us
Kiteview Technologies (Pty) Ltd was founded in May 2010 to provide the Sage Evolution Business Management solution to the SME market. The management team of Kiteview have combined +30 years of experience in the delivery of small to mid-market Financial & Business Management solutions. This experience, combined with a sound project implementation methodology has helped in Kiteview’s growth, becoming a Platinum status partner for SAGE Pastel within just 1 year.

Contact Us

For An Obligation Free Quote

5 Signs Your Company Is Ready For Business Intelligence

5 Signs Your Company Is Ready For Business Intelligence

Article credit: Sage 

Is your company ready for business intelligence? You’ve recently equipped yourself with a nifty accounting solution and finally got on top of all that information that used to lay scattered about in the bottom drawer.

You’re booking in stock, creating neat invoices and you’ve smartly linked your bank account so you can quickly and easily see how much money is coming in, and how much is going out.

There couldn’t possibly be anything else that can make running your business smoother and more efficient, right? Think again. Think business intelligence.

Business intelligence? What are you talking about?

We’re talking about igniting the usefulness of all that data your accounting software is collecting and empowering yourself with accurate information that will help you succeed.

We’re talking about having the confidence to act and make on-the-go decisions about your business based on real facts and figures.

We’re talking about freeing yourself from the burden of never truly knowing where your business is at and how healthy it is at any given moment.

This is the power and effectiveness of business intelligence and why you’ll start winning as soon as you start making use of it. It can be a powerful asset for your company.

How do I know when I’m ready for business intelligence?

The beauty of business intelligence is that no matter how big or small your business is, there’s always a place for it in your arsenal of business success weapons.

Whether you occasionally need a quick glance into the health of your business, a deeper look into the finer details behind the stunning graphs and charts, a means to track and monitor who owes you money and by when, or a more in-depth analysis of your financials over a few months or years – business intelligence has your back.

Here are a few tell-tale signs that you can look out for to be sure you’re ready for business intelligence:

1. You’re not sure whether your business is in the green or red

Unless you monitor your business closely to immediately identify and address what’s causing your profits to shrink, things are likely to get worse.

A good dashboard will be able to show you how well your business is performing by monitoring monthly sales trends, managing your expenditures and tracking your profits and profit margins.

By having information such as this at your fingertips, you’re able to determine trends that will impact on future business decisions.

2. You don’t know how much cash you have available to spend

For small business owners, how you manage your cash is especially important because the money you received today may not be enough to run the day-to-day expenses of your business tomorrow.

This is why you need visibility into how much cash is coming in and how much is going out as accurately as possible – and through business intelligence, this information is easily available.

Use a financial hygiene dashboard for an overview of cash transactions
Use a financial hygiene dashboard for an overview of cash transactions

3. You have no idea what your best-selling goods are or who your best customers are

Knowing exactly which of your products or services is selling best and identifying who your top customers are is power for any business owner.

With this information, you’re able to plan ahead when it comes to ordering stock, positioning your products or services and nurturing existing customers.

The more you form relationships with your customers rather than simply managing transactions, the more sustainable your business becomes.

4. You’ve lost track of who owes you money and for how long

It’s important for any business owner to know exactly who owes them cash, how much, and when they can expect to receive it.

Without having visibility into this information, it’s like you’re delicately balancing your company’s cash flow with one hand while walking a tight rope, in the dark.

A good business intelligence solution will not only reveal this information but will also make it possible for you to easily follow up on the overdue amounts before they seriously impact the health of your business.

5. You’re not sure where you spend most of your money and why

As a business owner, you need to know how much money you’re expected to pay your suppliers within your given credit terms in order to optimally maintain your cash flow.

A good dashboard will help you to fully manage your suppliers, which will ensure you maintain strong relationships with your creditors (the person or company who you owe money to).

As you actively communicate and keep up with payments, you’re better positioned to negotiate more advantageous terms that will help your business in the long run.

If any of these statements ring true for you and your business, you’re ready to start using business intelligence and benefiting from the value it adds.

Every day delayed is another day you could have taken advantage of all that data at your fingertips transforming it into actionable business insights that will help take your business further.

Get an overview of your sales - what's performing well and what isn't
Get an overview of your sales – what’s performing well and what isn’t

You’ve got me – what now?

Convinced it’s high time your data starts working for you? Good.

Now, it’s often thought that implementing a business intelligence solution is complex and costly. Some business owners think that massive costs and IT resources are required to gather the information.

Then, once information has been gathered, they believe time needs to be spent organising the data so it can be used.

While this may have been the case a few years ago, it couldn’t be further from the truth now.

A decent accounting solution already includes standard business intelligence that helps you get an instant view of the data your business gathers.

However, a great accounting solution comes equipped with business intelligence that helps you solve the aforementioned problems and more.

Explore your accounting solution today and ask yourself the following questions when it comes to business intelligence:

1. Is all the information I need to monitor my business ready to use and easily available?

You’re a business owner, not an accountant. We understand you have little time to figure out how to create reports. You need to focus on running your business.

So, the ideal accounting software needs to provide you with dashboards and reports that are ready to use, easy to consume and highlights vital information that impacts your business.

2. Am I able to take a deeper look into this information if something needs investigating?

Gorgeous and visually striking dashboards are great but they sometimes lack in their ability to provide real, action-oriented value.

What if you need to look a little deeper into the information that makes up these flashy graphs and charts?

This is where interactive dashboards come in handy – and we’re not talking about simply reorganising your view of it.

Make sure your accounting solution is equipped with business intelligence that allows you to easily click through and view the details behind the dashboard so you have full visibility into what’s going on in your business.

3. Can I easily customise or create new reports from scratch?

For your business to succeed, your reports must focus on information that is relevant to you and can help you make smart business decisions.

For example, you should have the ability to easily customise your sales reports to show which products are selling fast, as well as products that are not doing as great.

You should also be able to make small tweaks, such as adding extra rows or columns and adding your company logo.

And when you get more comfortable, you’ll also want to be able to easily create your own reports from scratch – depending on your requirements.

Whatever the case, the need for business intelligence regardless or whether you’re just starting out or you’ve starting growing is becoming more and more evident by the day.

Instead of waiting for the tidal wave of data to come tumbling down on top of you, heed the warning signs and ensure you’re proactive in raising your business way above the high-water line.

About Us
Kiteview Technologies (Pty) Ltd was founded in May 2010 to provide the Sage Evolution Business Management solution to the SME market. The management team of Kiteview have combined +30 years of experience in the delivery of small to mid-market Financial & Business Management solutions. This experience, combined with a sound project implementation methodology has helped in Kiteview’s growth, becoming a Platinum status partner for SAGE Pastel within just 1 year.

Contact Us

For An Obligation Free Quote

Top 3 Tips To Grow South African Businesses In 2019

Top 3 Tips To Grow South African Businesses In 2019

Article credit: Sage 

2019 is well underway, bringing with it a range of risks and opportunities for startups and growing businesses. Some of the challenges your business will face – a volatile rand, Eskom load shedding, tax and labour laws – are beyond your control. To thrive this year, focus on what you can control by optimising your operations and enhancing productivity.

Growing your business is all about efficient use of staff, scaling business systems and processes, and using data more effectively. The beginning of a new year is an ideal opportunity to review and enhance your business to iron out glitches in productivity and maximise profits.

Here are a few tips about how you can evaluate and improve processes and technology.


opportunities_to_grow_small_businesses

 

1. Identify where poor-fitting or old technology is slowing you down

Begin with a thorough review of processes and technology to identify key potential wins. If your business has been going for a few years, you may have old technology in place that was right for the time, but which is a bad fit for your current and future requirements.

Even if your business is relatively new, there might be opportunities to streamline processes further or to introduce technologies that offer you better visibility into business performance.

For example, you might be using spreadsheets to manage inventory or your payroll, which is time-intensive, error-prone and inefficient, or your accounting system may not integrate with your e-commerce and inventory management systems.

If you find that you or your team are spending a lot of time on manual processes or on capturing data across multiple systems, you probably have some opportunities to automate. For example, a payroll solution can manage your payslips and SARS submissions with the press of a button. An affordable accounting solution can let you easily generate invoices, quotes and VAT returns.

2. Set goals for process and technology improvement 

Once you have identified the pain points in your business, you should evaluate what you want technology to do for you. Is the goal to free up more time for your team to focus on activities that produce more income? Try to quantify the hours you wish to save and how they will be reinvested in the growth of the business.

Do you want to improve your insight into the performance of your business? Think about which financial metrics you want to measure, and which data and tools can provide the insights you need. Perhaps you want to improve the customer experience, in which case you should look at how CRM systems could give you better insights, enabling you to respond to and even predict your customers’ needs.

Here are some ideas:

  • Automating manual processes: Make better use of your people by reducing their workload and offloading the trivial, repetitive tasks while freeing up their time and creativity for tasks that continue to grow the business.
  • Data analytics and intelligence: Ensure not only that everyone can see the data they need when they need it, but also that the data is current. This allows a predictive approach to opportunities and problems.
  • Improving accessibility: Ensure data is shared across departments and that it’s available to all 24/7, across all kinds of technologies, including mobile devices.

 

3. Identify the right tools and solutions for the job 

With so many business solutions to choose from, it can be difficult to decide where to invest and how to prioritise. Some factors you should consider as you look at possible solutions include:

Integration: Ensure the systems you set up today can be integrated with third-party solutions in the future, and that they can easily integrate with your customer and vendor systems. For example, an integrated payroll and accounting solution will save hours because you won’t need to capture payroll transactions twice. 

Scalability: Look for a system that not only meets your needs today, but  can also evolve with your business. By automating today with the right solution, you can avoid growing pains and the need for further complex integrations and implementations down the line. 

Mobility: Business today should not be limited to office hours or physical boundaries. Look for a solution that puts your customers’ and financial information in the palm of your hand. This will enable you to work remotely and boost productivity and responsiveness.

Changing to fast, agile and efficient is not easy, but it’s essential to enable scalability. High-growth firms aren’t stuck with balls and chains around their ankles, holding them back. They have typically built efficient, automatic processes and are using new technology with a light human touch to focus on the business essentials.

About Us
Kiteview Technologies (Pty) Ltd was founded in May 2010 to provide the Sage Evolution Business Management solution to the SME market. The management team of Kiteview have combined +30 years of experience in the delivery of small to mid-market Financial & Business Management solutions. This experience, combined with a sound project implementation methodology has helped in Kiteview’s growth, becoming a Platinum status partner for SAGE Pastel within just 1 year.

Contact Us

For An Obligation Free Quote

Client Testimonial – Lambson’s Hire

Client Testimonial – Lambson’s Hire

Find out what Sonette and the team from Lambson’s Hire Testimonial have to say about Sage Evolution business partner Kiteview Technologies service and Sage Evolution support.

About Kiteview
Kiteview Technologies (Pty) Ltd was founded in May 2010 to provide the Sage Evolution Business Management solution to the SME market. The management team of Kiteview have combined +30 years of experience in the delivery of small to mid-market Financial & Business Management solutions. This experience, combined with a sound project implementation methodology has helped in Kiteview’s growth, becoming a Platinum status partner for SAGE Pastel within just 1 year.

Facebook Linkedin

Contact Us

For An Obligation Free Quote

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from our team.

You have Successfully Subscribed!