Credit Policy for businesses and how to extend credit and manage credit risk

This is the headline of an article in Tuesday’s Wall Street Journal.  I was recently writing about things business owners can do to create more income during tough economic times and one of the things I wrote about was cutting back on cash rewards or bonuses, and things we might consider luxuries.  After being in the news in connection with the subprime mortgage mess and selling to Bank of America Corp for approximately $4 billion it came as a surprise to me to read that Countrywide has hosted similar meetings for years but a Countrywide spokesman said “in light of recent events, we have decided to cancel all such gatherings for the remainder of the year.” 

While you probably don’t go to the extreme of having your company host a ski trip at the Ritz-Carlton Bachelor Gulch ski resort in Avon, CO, there are probably some luxuries within your business that you can cut back on.

Remember that the best way to increase your cash flow fast is to collect on your accounts receivable and the next best thing is to cut back on expenses.