The terms say 30 days. The money arrives on day 58.

The 28-day gap between your payment terms and your bank balance isn't one delay. It's four, and only one of them responds to chasing.

By Steve 4 min read
Abstract bridge artwork for The terms say 30 days. The money arrives on day 58.

Most businesses that measure days sales outstanding discover a gap between what the contract says and what the bank shows. Terms of 30 days, cash arriving on day 55 or 60. The reflex is to chase harder: a firmer letter, a weekly call list, perhaps a credit controller. Sometimes that works. More often it produces a modest improvement that decays within two quarters, because chasing only acts on one of the four distinct delays hiding inside that number. The useful move is to decompose the gap before trying to close…

Keep reading for free

Create an account to read the rest.

The whole library is free. No card, no subscription, no trial that quietly ends. An account simply lets us know who we are writing for, and opens every article from here on.

  • Every article, in full, at no cost
  • New articles published every weekday
  • Takes about twenty seconds
Create a free account I already have one

Free means free. We will not charge you for the library, and you can read as much of it as you like.

Important: General information only. Rialto Bridge articles describe patterns and considerations that may apply to a business; they are not financial, legal, tax or accounting advice, and they take no account of your particular circumstances. Consider your own situation and seek advice from a qualified professional before acting.

More on Operations

Scroll to Top