Are you Getting Paid On Time?
As we kick into May and see the half year goal approaching a lot of our clients have been focusing on cash flow and looking at aged debtors. Almost all businesses will have cash flow challenges and so we put together some workshops with those clients we help with credit control issues.
We ran the workshops using 5 core steps to improve cash flow and we share those with you here:
- Get clear terms and conditions in place, however you sell, whatever you sell you need terms and conditions in place. These should be reviewed every 12 months and be detailed when it comes to what you expect from clients and customers in terms of payment. Everything needs to be in there from complaint handling to charges for late payment and you need to be getting them out with every quote and getting them signed, online or off.
- Early invoices get paid faster. Even if an invoice is not yet due get it sent fast and make them stand out. We use Getnotify.com to provide us with an email open and receipt but there are loads of software options to record send and open date and time – proof of delivery.
- Remind Often. Send reminders starting 14 days before the due date, it doesn’t have to be in an email headed up REMINDER INVOICE, it can be a friendly email drawing their attention to something beneficial to their business – a blog or something relating to their industry. It just needs to be the norm to remind often so invoices don’t get overlooked. Often this will provoke an early payment because your relationship has placed payment as a priority.
- Stay on the clients’ radar. Use social media and LinkedIn to keep in touch, out of sight out of mind is very true so keep at the forefront of your clients’ mind. It helps when it comes to payment and new work and shows you make the effort.
- When payment is late make it personal. Get on the phone and talk to the person responsible, get confirmation of the date the invoice will be paid and the ramifications for payment being late, i.e. interest, late payment penalties etc. It’s a thin line for a client to become a debtor and if you are into a long contract missed payments soon mount up. Consider whether withholding work, assets or delivery is permitted in your terms and start using them fully.
For more resources look at:
Are you having to wait to get paid? Talk to us on 01244 300413 or email [email protected]