Boston Commercial pty ltd

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Why Too Much Outstanding Debt is a Game Changer
And Not for the Better
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Allowing clients to trade on credit is a common
way to facilitate more business. However it can
also lead to short term and long term financial
burdens when repayment terms are not adhered to
and bad debts are allowed to accrue. The
cumulative financial impact of bad debt on a
business, often leads to a number of game
changing consequences which can have devastating
effects
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PLUMMETING PROFITS
When you are simply not being paid for the work
that you do, direct lost profits are just the tip
of the iceberg. The additional work you need to
do to recoup the lost profits means you are
working harder for the same amount of money.
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Bad debt can immobilise your businesss money
making capabilities. Capital is required whether
you want to expand, transition or grow your
enterprise. If poor cashflow has depleted a
businesss cash reserves, it will need to seek
out finance or external investment. The
difficulty is however, that businesses with
significant debts are unattractive to prospective
lenders or other creditors, limiting their
ability to acquire finance or buy new equipment
or supplies on credit.
IMMOBILISATION
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INSOLVENCY
At the end of the day cash flow is paramount to
the survival and success of a business and a lack
of it will ultimately lead to personal or
corporate insolvency
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BCS_at_thebostongroup.com.au1300 668 6991300 668
499PO Box 67, Milsons Point NSW
1565http//www.bostoncommercialservices.com.au/wh
y-too-much-outstanding-debt-is-a-game-changer-and-
not-for-the-better/