Treasury, fund and Cashflow management
What factors should be considered to improve cashflow for a freight forwarder?
credit, billing and collection
What factors should be considered to improve cashflow for a carrier?
when to buy a ship
What factors should be considered to improve cashflow for a warehouse service provider?
How long the rental contract should be and Is it a dedicated warehouse or not
What is the most important element of cashflow planning?
debt collection
What is the result of cashflow planning?
substainability
What are critical contract terms in safeguarding cashflow?
no set off right, lien on cargo, overdue interest, payment on behalf, right to mean, routing, non-delivery, order on behalf of customer
What are critical factors in determining the cashflow?
profitability, self own or outsourcing, funding structure
What are the key determinants of cashflow?
payment terms, payment on behalf
What could affect the level of cashflow?
tax planning
What are the practical method in improving cash flow?
factoring, disposal of unused fixed assets, sales and lease back
What is the most effective method in improving cash flow?
revise credit limit and payment term for low margin customers
terminate contract with loss making customers
What is the result of appreciation in value of fixed asset?
What change to improve cashflow?
bank guarantee instead of deposit, reduce number of deposit in terms of month
What is the costly method to improve cashflow?
cash discount
What is the costly method to extend sales?
longer payment term
What operation procedure can be improved to speed cash collection?
- billing accuracy
- update quote
- fast pricing
- contract renewal
What are contingent impact on cashflow?
unfavorable exchange loss, unabsorbed cost, compensation
What are the factors that affecting cashflow planning?
- terminate contract with loss making contract
- Injection of capital
- Improvement in collection
- Factoring
- Cost reduction-headcount
- Redundancy planning
- Product planning, COD product
What should be considered for cashflow planning?
- Payment term to vendor is longer than that granted to customer
- Investment requested by customer
- Eliminate loss making business, fixed cost contract, min. charges after considering discount, share of overhead and idle capacity
- Early renegotiation of fund from bankers
- Credit evaluation to ensure on time collection from customer
- Billing accuracy to avoid late settlement
- Good debt collection to ensure on time settlement
- No deposit to vendor for guaranteed purchase
- Unexpected compensation and tax penalty
- Contingent plan for economic downturn
How to improve cashflow?
- Payment term to vendor is longer than that granted to customer
- Profit and growth to generate the cashflow if possible
- Eliminate loss making business after considering discount, share of overhead and idle capacity
- Credit evaluation to ensure on time collection from customer
- Billing accuracy to avoid late settlement
- Good debt collection to ensure on time settlement
- No deposit to vendor for guaranteed purchase
- Control on investment
cashflow Strategy for IT company?
- Payment term to vendor is longer than that granted to customer
- Profit and growth to generate the cashflow if possible
- Eliminate loss making business after considering discount, share of overhead and idle capacity
- No deposit to vendor for guaranteed purchase
- GAAP Compliance to ensure recurring fund from IT fund
- Accurate budget and forecast to ensure recurring IT fund
- Credit evaluation to ensure on time collection from customer
- Billing accuracy to avoid late settlement
- Good debt collection to ensure on time settlement