When it comes to cash , we mean business
Business is tough at the moment so it is more important than every to be on top of your cash collections.
In our previous post, we talked about the various administrative issues that can prevent or delay payment of your invoices by customers. Once you have cleared up all of these administrative issues, you are left with the tougher debts. The slow payers, the ones who are treating your business like a bank, the ones that unfortunately might be in financial trouble. This is when we have to mean business.
Here are my tips on how to collect that cash:
1. Be confident in your accounting systems.
You need to know that if your accounts say that an amount is outstanding then it actually is. Reconcile regularly. Know how to record under or over payments from your customers. ( Look out for our upcoming video on this) .
2. Pick up the phone.
Emails only get you so far. Speak to a human – business owner to business owner. Understand what the issue is but let them hear in your voice that you want to be paid.
3. Negotiate terms
Be willing to consider a payment plan. It is always better to receive something rather than nothing. Confirm the plan in writing via email and then hold your customer to it.
4. Be tenacious
It is a proven fact – ” the squeaky wheel gets the grease”. Be annoying yet polite. Communicate continuously to the point that your customer will pay you just so that they don’t need to speak to you again. Let it be known that you want to be paid and you will keep going until that cash is in your bank.
5. Call in the experts if you need them.
If the $ amount warrants it, employ a debt collector ( or contact Balanced Advantage to help you out). Most debt collection services won’t require payment until the debt has been paid. This is needed only for those debts that are really in trouble but is a good step to take rather than just giving up.
Business owners can’t afford to be too busy to chase debts. Cash is the lifeblood of your business so go get that cash!.