What is Account Receivable (AR) in Retail? Explained

Accounts receivable (AR) embodies the outstanding payments awaiting collection from customers for provided goods or services on credit. It stands as a valuable asset on a company's balance sheet, representing the sum owed by clients. Efficient management of AR is crucial for sustaining healthy cash flow. Businesses employ strategies like timely invoicing, setting clear credit terms, and proactive follow-ups on overdue payments to optimize processes and ensure financial stability.