by Dr Lisa | Theory of Constraints Finance, Accounting, and Cash Flow, Theory of Constraints Sales
Last time (on Friday) we talked about offering a discount to our customers if they paid on delivery. What kind of discount could you offer to get cash back into your system faster so that you could make more money? Before you answer that question, also consider that...
by Dr Lisa | Theory of Constraint Books and Book Reviews
The Goal, orginally published in 1984 is the best selling business book in the world. You can still walk into most books stores and find a copy on the shelf. Right now, it is selling really well in Japan. The BusinessWeek Best-Seller List — Paperback Business...
by Dr Lisa | Theory of Constraints Finance, Accounting, and Cash Flow
Now let’s look at the impact on what we discussed yesterday had on our throughput. Let’s say we immediately visit a customer whose complete order was shipped and had just been received by that customer. We make, and they accept, our 20% Discount Mafia Offer and we...
by Dr Lisa | Theory of Constraints Finance, Accounting, and Cash Flow
Reducing Float for the Cash Constrained Company Now let’s consider a case where there is a cash constraint. When cash is your constraint, going out of business is usually not far behind. Most small businesses go out of business because they have run into cash...
by Dr Lisa | Theory of Constraints Finance, Accounting, and Cash Flow
The Role of Payment Terms in Cash Velocity To reduce the time it takes to collect payment from our customers we offer a 1%/10 option, but none of our customers use this option and many of them pay late which is why we have an average of 42 days. So we remain at 55...
