Mail Delivery Change Could Cost a Large Company Up to $100 Million Annually

Implement relevant performance indicators.—“Companies need to get ahead of the game, and measure float now in areas like mail, bank clearance, and payment processing,” said Heald. “This will enable them to set reasonable improvement targets.”

Understand and enforce terms and conditions of contracts.—“It’s surprising how many companies simply don’t enforce the existing provisions in their contracts,” said Ms. Heald. “For example, they may allow their customers to calculate payment due dates from when the invoice is received while the contract calls for it to be calculated based on the day it is issued.”

Reconsider grace periods and discounts.—“Grace periods and early discounts can be more carefully tracked, to avoid giving customers discounts they haven’t earned,” explained Heald. “Unless customers change their payment processing strategies to account for the increase in mail float, which is unlikely to happen, payments will be received later than ever, including discount payments.”