Flow of payment process.

Discussion in 'Cashflow forum' started by charlie_Brown, Sep 3, 2012.

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  1. charlie_Brown

    charlie_Brown UKBF Newcomer Free Member

    14 0
    Can anyone explain to me or show me online where I can understand more about the flow of payments from my customer to me and from me to my supplier if I am a trading company / middle man.

    So I am receiving and sending payments to both my customer and supplier, what and when and what type.

    I am the middle man buying stock and re selling it and marketing it up, also designing our own products with manufactures and selling on, mainly from China to European markets and US

    many thanks for all your help in advance.
     
    Posted: Sep 3, 2012 By: charlie_Brown Member since: Aug 29, 2012
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  2. Scalloway

    Scalloway UKBF Legend Free Member

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    You pay your supplier. Hopefully your customers will start paying you at the same time.
     
    Posted: Sep 3, 2012 By: Scalloway Member since: Jun 6, 2010
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  3. GJones

    GJones UKBF Newcomer Free Member

    7 0
    Hi Charlie_Brown,

    This depends really on what terms you are offered/offering by suppliers/to customers. If you are selling goods to consumers and paying suppliers on credit then:

    1. Payment instantly from the customer and then payment to the supplier once terms are reached.

    Obviously there are many variations of this, such as different customer/supplier credit terms and indeed some opportunities such as assignment of proceeds , financing or factoring arrangements which can directly impact on the flow of payment.

    As the middle man, the best that can be done to improve cash really is to avoid any over build-up of stock. One useful area of research I would recommend you look in to (if not already done) is Just-In-Time distribution or even VMI which can offer you some real insight into building the correct structure from supplier to customer/consumer. A quick web search can produce some interesting articles.

    Good luck and hopefully that has helped.

    Gavin
     
    Last edited: Oct 7, 2012
    Posted: Oct 7, 2012 By: GJones Member since: Oct 7, 2012
    #3
  4. mcjohn

    mcjohn Banned

    44 2
    Hello Charlie Brown, i would like to say that you should pay your supplier first and i hope your customers will start paying you regularly.
     
    Posted: Nov 22, 2012 By: mcjohn Member since: May 24, 2012
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