Businesses in all sectors are trying to get a more stable footing in the COVID-19 economy. Regions around the country are reopening, giving businesses the opportunity to resume operations and hopefully get back to pre-pandemic production rates. Cash flow is crucial to the future success of businesses as the economy reopens, and gaps in revenue can cause major setbacks.
Why Do Gaps in Revenue Occur?
Gaps in revenue can occur for a number of reasons, but the most common cause is from unpaid receivables. Businesses issue invoices with staggered payment schedules of 30, 60, or even 90 days. This is a standard business practice designed to give clients a grace period to make payments, and the staggered schedules, in theory, provide businesses with a constant stream of revenue. More often than not, staggered payment schedules lead to gaps in revenue while businesses wait for their clients to make payments on the balanc