by: Sarah Joson
Wednesday, December 14, 2011 | Outsourcing News |
Based on the Executive Insight Survey which was done online in September, twenty nine percent of respondents said delayed cash flow affects growth. Other areas that affect payment delays are hiring capabilities (27 percent) as well as revenues (20 percent). Late payments also affect the ability to offer wage increases, support on innovation, and investment in research and development.
Almost half (45 percent) of Fortune 1000 executives stated that they have experienced an increase in deferred payments from their clients, while 15 percent said they’ve seen a 25-percent increase in late payments last year.
There are several strategies companies can do to deal with payment delays. One of these is outsourcing cash collections. Majority of the companies that do so reported that it reduced their bad debt loss. They’ve also posted a 34-percent increase in profitability, and 32-percent growth in all points of the revenue cycle.
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