Industry sector: Retail and wholesale

Architectural salvage: Cash from debtors

'Cash from debtors' means any income you receive from account customers that you send an invoice to, usually at the end of the month. After you've sent them an invoice, but before they pay you, they are your debtors. When they do pay you, the payment is referred to as Cash from debtors.

Payment terms - account customers

Decide whether you'll offer account facilities to anyone, and if so who'll be eligible. Account customers might include businesses and organisations that buy items from you on a regular basis, for example:

  • other architectural salvage and antique dealers
  • builders and other trades-people, including specialists in restoring and conserving period properties
  • designers and architects
  • landscapers
  • organisations that maintain a large number of period properties, like the National Trust, the Landmark Trust and the Churches Conservation Trust

Agree payment terms with your account customers if you have any. You might, for example, require all accounts to be settled every month, perhaps by a particular day of the month. Alternatively, you might state on your invoice that payment must be made within 28 days of the invoice date. Consider what steps you will take to recover any overdue amounts. The architectural salvage trade is generally quite a friendly and relaxed one - that's part of its appeal for many - but it doesn't pay to be too relaxed about bad debts!

Make an estimate of the amount of income you're likely to receive from account customers each month. Enter the amount in your cash flow - remember to put it in the month in which the money is due to be received.

Your business stationery

Have some invoices printed for sending to your account customers. A good printer will be able to advise you on layout and style. If you're registered for VAT you must include your VAT registration number on your invoices.