Keep your cash flow in check with these tips
Every company has them: slow-paying customers. They can really cause headaches and keep business owners up at night. Nothing is more stressful than having to play bill collector–all while trying to juggle the demands of running a business. Money is the lifeblood of any business, so it’s important that you don’t let delinquent accounts bring you down.
Consider these ways to encourage your customers to pay on time, so you can spend less doing things that actually make you money.
1. Incentivize prompt payment. Think for a moment about the true cost of tracking down payment. What sacrifice would you be willing to make to get paid sooner? You might consider offering a nominal discount to encourage clients to pay within a matter of days, instead of weeks.
2. Give them a good reason not to pay late. Have late payment policies in place–and stick to them. If you are too lax or forgiving you might find that some customers might take advantage.
3. Make it painless and straightforward to pay. The easier you make it to actually complete the transaction, the faster you might get paid. If you don’t accept credit cards or mobile payment, maybe this is the year you make that investment to accommodate preferences.
4. Make it less personal. If you find that late payment is a recurring issue with some accounts, you might consider outsourcing collection. Let someone else be the bad guy so you can focus on the day-to-day tasks.
One closing thought: If you are in the position to “fire” a client, slow payment is a valid reason. Maybe 2017 is the year of cleaning house?