Cash Flow Crunch? Mastering Accounts Receivable in Machine Making

Machinery Manufacturing has many #challenges, like dealing with intricate #designs, long production cycles, and high-value equipment. But one thing that remains constant is the need for a healthy cash flow.??

Unfortunately, managing #accountsreceivable (AR) in the machinery manufacturing sector is not easy at all and presents unique challenges. Here, we will explore two common hurdles and offer unique solutions to help you keep your engines running smoothly and accelerate consistent #revenue.??

Challenge #1 – The Double Trouble: Slow Sales & Late Payments??

Building custom #machines is fantastic, as it often involves lengthy #salescycles. Unlike store-bought things, these #projects involve many steps, from sending a price quote to getting the machine all set up at the customer’s place. This #waitingperiod can mean you have less money available, making it tough to invest in innovative ideas or cover everyday business costs.??

Solution - Make Buying Easier with Flexible Payment Structures?

Consider offering a flexible #payment plan for your customers. This can include:???

• Progress Payments: Instead of waiting for one big payment at the end, split the #totalcost into smaller chunks tied to various stages of the project. This way, you get some #money upfront and throughout the building, and your customer knows exactly when each payment is due.?
• Leasing Options: For those #expensive machines, leasing can be a great solution for everyone. The customer pays a smaller amount #upfront and then makes regular monthly payments, just like renting an apartment. This makes it easier for them to afford your machine, and you get a steady stream of income throughout the lease period. Just be sure to partner with a good leasing company to handle the paperwork and collect the payments.?

Challenge #2 - Confusing Bills & Payment Headaches?

Those amazing machines you build can also mean complicated bills for your customers. With all the various parts, customs features, and even service agreements tacked on, it is easy for invoices to get confused. This can lead to arguments about the bill itself, or even disagreements about how well the #machine works after it is delivered.?

Solution: Simplify the #Billing Process and Invest in Early Intervention?

Simplifying your invoicing process reduces the risk of errors and delays. Here are some tips:?

• List everything out clearly all components and services.?
• Define #payment terms and late fees explicitly.?
• Give them options for invoice formats (e.g., digital, paper).?
• Integrate AR software for faster processing and recordkeeping.?

Catch billing issues early & offer clear #communication channels. Extended warranties (optional) can build trust and reduce delays.??

To Conclude:??

Cedar Financial can help! With over 30 years of experience in machinery manufacturing collections, they understand the unique #challenges you face. They offer customized collection plans, clear communication, and a global network to receive outstanding debts and keep your business running smoothly. let them handle AR headaches so you can focus on building amazing machines.?