" A STRUCTURED APPROACH TO RECEIVABLES MANAGEMENT IS PARAMOUNT . IT CAN MEAN THE DIFFERENCE BETWEEN A THRIVING BUSINESS AND ONE CONSTANTLY STRUGGLING TO MEET PAYROLL OBLIGATIONS ," ADVISES AUSTIN . TO COMBAT THIS PROBLEM , SMES CAN IMPLEMENT EFFECTIVE INVOICING AND PAYMENT COLLECTION SYSTEMS . THIS INCLUDES SENDING INVOICES PROMPTLY , SETTING CLEAR PAYMENT TERMS , AND FOLLOWING UP WITH CUSTOMERS WHO HAVEN ' T PAID ON TIME . ADDITIONALLY , OFFERING INCENTIVES FOR EARLY PAYMENTS OR PENALTIES FOR LATE PAYMENTS CAN ENCOURAGE CUSTOMERS TO SETTLE THEIR INVOICES PROMPTLY . · BUILD A FINANCIAL SAFETY NET EVEN WITH CAREFUL PLANNING AND EFFICIENT CASHFLOW MANAGEMENT , UNFORESEEN CIRCUMSTANCES CAN DISRUPT BUSINESS OPERATIONS AND STRAIN CASH RESERVES . TO ENSURE THEY ALWAYS HAVE MONEY FOR PAYROLL AND SALARIES DURING THESE CHALLENGING TIMES , SMES SHOULD CONSIDER ESTABLISHING A LINE OF CREDIT OR AN EMERGENCY FUND . TO UNDERSCORE THE SIGNIFICANCE OF FINANCIAL BUFFERS , AUSTIN SAYS , " THINK OF IT AS A BUSINESS ' S INSURANCE POLICY . IT PROVIDES PEACE OF MIND DURING UNCERTAIN ECONOMIC CONDITIONS ." ACCORDING TO A FATOKI AND SMIT REPORT , NEW SMES IN SOUTH AFRICA OFTEN FACE CHALLENGES WHEN IT COMES TO OBTAINING EXTERNAL FINANCING . THE UTILISATION OF TRADE CREDIT AMONG THESE EMERGING SMES IN SOUTH AFRICA IS NOTABLY LOW , STANDING AT JUST 0.2 %, WHICH LIMITS THEIR ABILITY TO WEATHER FINANCIAL STORMS . BY PROACTIVELY SECURING A LINE OF CREDIT OR SETTING ASIDE A PORTION OF PROFITS AS AN EMERGENCY FUND , BUSINESSES CAN BRIDGE THE GAP DURING TOUGH PERIODS WITHOUT COMPROMISING THEIR ABILITY TO PAY THEIR EMPLOYEES . “ ENSURING A STEADY PAYROLL FOR SMALL AND MEDIUM BUSINESSES IS VITAL FOR THEIR FINANCIAL HEALTH AND EMPLOYEE SATISFACTION . BY IMPLEMENTING THESE THREE STRATEGIES , SMES CAN BETTER MANAGE THEIR FINANCES , REDUCE THE RISK OF PAYROLL DISRUPTIONS , AND PROVIDE A STABLE AND SECURE WORKING ENVIRONMENT FOR THEIR VALUABLE EMPLOYEES . THESE STRATEGIES EMPOWER SMES TO NAVIGATE FINANCIAL CHALLENGES WITH CONFIDENCE AND ENSURE THEIR CONTINUED SUCCESS IN A COMPETITIVE BUSINESS LANDSCAPE ,” CONCLUDES AUSTIN . -
About Michelle Austin Michelle Austin CA ( SA ), Cert . Dir . is a South African businesswoman , podcaster , and finance director at Keegor Group SA . Michelle is also the recipient of numerous awards such as : 40 Under Fourty Award in manufacturing ( 2023 ), Platinum TITAN Business Award for Woman Leadership of the Year ( 2023 ), and SEIFSA ’ s 2022 Business Woman of the Year .