How do accounts receivable affect your eCommerce?
From the very moment, companies started to allow payments of their operations on credit, trade receivables became a key element in managing their cash flow, as customer companies demanded deferred payment for their supplies. Nowadays, deferred payment of invoices is normalised (and even fundamental) in commercial relations, and the business world could not be understood without its existence.
E-commerce companies have been no exception, and accounts receivable are a key element of their cash flow, as they affect their working capital. Any problem that arises in this indicator is usually a direct consequence of incorrect management of accounts receivable: whether it is a miscalculation of customer risk, high delinquency or a drop in a customer's credit score, among many other things.
This is especially relevant for those businesses that operate through a marketplace. In these cases, it is the platform that receives the revenue from the sale, net of service fees, and then passes it on to the sellers at a later point in time.
For example, Amazon pays your sellers' sales every 15 days, so you receive twice a month the amount of all your sales during that period. You will need to take this delay in the collection of sales proceeds into account when organising your working capital cycle and the implications it may have on the liquidity of your business.
