So you have a great product, margin is good, marketing is flying but the world seems bad.
Every time you login to your bank account the number is getting smaller and smaller.
You check sales and they are going up – what is wrong with this business you say?
Simple, working capital cycle!
In the excitement of bringing your product to market you don’t spend long enough working on supplier support.
If you wandered in to see a Tesco buyer you wouldn’t expect them to whip out their chequebook there and then and order and pay, so why do you do this with your suppliers.
Even for businesses that I am involved in that have good access to funding or personal cash there always comes a point where you need more working capital.
So once you have ordered once or maybe twice from a supplier make sure you spend some time speaking to them about the route to credit. If you don’t ask you don’t get!Tweet