As a small business owner, cash is king. One of the most important ways to ensure that your business stays afloat is to ensure that you get paid when you need to be paid. Here are some tips to make sure your accounts receivable stays healthy.
Clearly state your payment terms
Make sure that your payment terms are clearly stated on all invoices you send out to suppliers so that no supplier can tell you that they didn't know how quickly to pay. You may also want to consider offering a discount for paying before the due date as well as penalties or interested accrued after the due date. Not only does this provide an incentive for small companies to pay more quickly, but additionally, for larger companies, sometimes there are policies that require companies to pay earlier if there are incentives in place for early payment.
Follow-up within the time frame
If you do not get payment by the scheduled time, you should follow up with the company using a phone call or direct contact. Small businesses may be more inclined to pay their bills more rapidly if they know that they are holding out payment from another small business owner. The personal touch can be useful to help trigger payments. Many customers are also overwhelmed with day-to-day obligations, and it can be easy to forget the payments that they need to make.
Make use of a debt collector
Debt collectors can be useful to help chase up recalcitrant payers. Debt collectors can chase both personal customers and business counterparts and can be effective at using unique techniques to undercover the location and contact details of the payer. They can also be more aggressive in chasing down payments and have more time and scheduling to dedicate to chasing customers that are reluctant to answer queries. For small business owners who feel uncomfortable having these more pointed conversations with customers on payment issues, it can be useful to outsource these issues to a debt collector.
If you are feeling overwhelmed with the obligations of finding the time to chase down debtors it can be useful to employ a debt collector. Debt collection agencies have the specialist knowledge to help dedicate time and energy to chasing down the debts of your customers. By outsourcing this job, you can be free to dedicate your time to value-adding activities such as improving your business.Share