Finance leaders are facing stiff economic headwinds as 2023 unfolds.
The combination of rising interest rates, high inflation, a challenging labor market, and unpredictable expenses from clogged global supply chains have seemingly made an economic downturn inevitable.
Most finance departments have already taken steps to prepare for a recession
DSO stands at 40 days or more at 47% of businesses 2 .
The possibility of economic uncertainty comes as many businesses struggle with a cash crunch.
Thirty-six percent of finance leaders report that their company’s Days Sales Outstanding (DSO) increased
“up to 10 days” compared to the same quarter from the previous year, while nine percent of finance leaders say their company’s DSO spiked by 10 days or more compared to the same quarter from the year before
43% of businesses report that 11% or more of their receivables are more than 90 days past due 4
Finance can help a business navigate rough economic times. But finance leaders will need the right tools and approaches to managing their cash flow. The findings of 2022 IOFM’s Cash Management Index – a survey of finance leaders from organizations of all sizes across all industries – reveal five strategies to help finance leaders weather the economic slowdown and position their businesses for growth.
Included in this Contents
- Reevaluate your credit policies
- Invoice customers electronically
- Get paid electronically.
- Strive for straight-through processing
- Implement tools for cash forecasting
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