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Setting DSO target for Cash Collection

What if my director said to me, “I want you to achieve only 70 Days Sales Outstanding for this coming month September 2005.” How then do I calculate the cash required to achieve 70 DSO?
Illustration:
Assuming that […]

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Basic Collection Approaches:
There are many ways to try to collect. Do you know them?
Collection approaches can be broadly classified into:

Persuasion, e.g. “Pay now because it’s better for you…”
Coercion, e.g. “We’ll have to take other forms of action……….”
Education, e.g. “Your payment isn’t […]

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The telephone is basically an immediate and flexible method of “two-way” communication which is both time saving and flexible. Do not belittle collection by telephone as it is a very important task for a credit personnel as it demands a combination […]

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Importance of Credit Management and the characteristics of a well run Credit management department
Effective credit management and decisions are important elements in managing a successful business as it helps to:

reduce credit risk exposure,
improve cash management through timely collection,
balance and avoid possible losses on potential sales […]

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As mentioned in my earlier articles, Top management must review and reinforce the importance of certain measurements used in Credit management.. What are they?
Measurements in Credit Management includes the following :

Days Sales Outstanding (DSO)
Aged analysis of Overdues,
Overdues as a % of Total debtors,
Disputed Debts […]