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Improve Cash Flow with Smartsheet and QuickBooks Online

How to Speed Up Your Accounts Receivable Turnover with QuickBooks Online and Smartsheet

It's June 2017, which means we are onto a new topic for the month. This month I want to focus on practice management for accountants and bookkeepers. For business owners, it's just about managing your business from the inside.

I've talked a lot recently about cash flow, and how important it is to manage that part of your business really well. One could argue it's the most important thing. Manage your cash flow well, and you can stay in business, even when you're not operating with a profit.

The first thing I look at, when a client and I decide that we need to improve cash flow, is the accounts receivable. This is usually the lowest hanging fruit, in terms of improving cash flow for your business.

We have to achieve a careful balance when it comes to collections from our customers. We don't want to upset them. We want to be reasonable, and we want to ask them to do the same. The temptation here is to have different approaches with different clients, based on the relationship. The problem with this approach is that it is highly inefficient. What if instead, you built a uniform system around the assumption that every client is an amazing one, whose relationship you want to protect? This is probably a good platform from which to operate your business in general.

Great! Now let's build something in Smartsheet, to help maximize efficiency in improving cash flow for your business. The great thing about Smartsheet is that it is completely customize-able, so we can track everything we need.

In Smartsheet the "Primary" column ideally should be something that will never be repeated. The invoice number makes the most sense for this.

Then we'll need the customer:job, and it's probably a good idea to have the customer contact info handy - e-mail and phone #. We'll also want some dates in there:

  • Invoice Date
  • Due Date
  • Collection Date (see video for explanation)

Once you have this project set up, you will want to run an A/R Aging summary, and get the information into Smartsheet.

Finally we'll set up some alerts, and then we'll look at how to set up an "Update Request" to go to the client, asking about the payment.

Once the system is built (about 30 minutes in most cases) you will have a substantially automated collections process. All you will need to do is keep Smartsheet up to date, but you'll be getting alerts, to remind you to do that.

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