Having trouble collecting payments from your clients? Never fear…well maybe you should but this might help.
Small Business & Collecting Payments in a Bad Economy
Let’s face it, our economy has become incredibly unstable (thanks to good old Uncle Sam and a few choice banks amongst other things). It seems as though smaller businesses sometimes are delayed in being paid come bill collection time because larger corporations know we don’t have much leverage over them. There are a lot of us who share the same issues, so I’ve come up with a few (hopefully) helpful tricks and tips to prevent some anxieties that probably accompany most small business owners.
Make The Decision To Be Picky
Decide if the potential client is worth the time & talent the job will take. Were they courteous over the phone, or did they leave you feeling rushed and frustrated? If during the initial phone call, your inner voice is singing “I’ve Got To…Run Away” listen to it…we have an inner voice for a reason. Also, don’t accept every Tom, Dick, and Harry that knocks on the door. If they are calling your company, they’ve probably checked you out already, and know they want you for the job because of your talents. These clients are asking for your abilities because they know you are the best. They need your companies expertise, and that’s why they called in the first place. Don’t discount that. You are in a position to be choosy, and should be. Besides, people do their best work when doing a job they love, so be choosy in order produce your best work.
On a side note, ever hear of the phrase “Birds of a Feather Flock Together”? Well this rings true with clients also. The idea is to land the clients you love, and for those clients to refer prospect clients to you of like-mind, giving you a full base of people you love working for. Seems simple enough…right?
Encourage On Time Receivables
Companies today, no matter how large or small, want to hang onto their cash for as long as humanly possible. It’s no day at the park when you have to make that call to a client saying, “Your payment is past due, when can we expect it?” This is an uncomfortable situation for everyone. To help avoid this unpleasantness, I have compiled a few helpful strategies in collecting payments, on time.
Be clear (up front) about how your payment plan works, and in doing so, give details on how your billing department operates. Is your company net 30, net 45, or net 60? There certainly isn’t any harm in having someone in your finance department attend a meeting to explain how your payment procedures work. This will help the client know that you are serious about your billing process and have expectations that need to be met. Offering discounts on early payments is another good strategy. Small businesses are usually last on larger venders list of payees. By offering a discount on early payments, those larger venders may jump on the idea of saving a few hundred dollars and submit their payment…EARLY! Learn to be “pleasantly annoying” by making a phone call before payments are due. Ask the client if they need (or want) any other services your company offers. Double check on the contact information they have for you and explain you want to be sure everything is in order before the product/services are finalized. If you’re in their ear, they won’t forget you. As they say, “the squeaky wheel gets the grease.”
Check’s in the Mail
Are you singing the ever popular song “Money Changes Everything” when the mail-carrier delivers your checks? Show your enthusiasm by sending a simple thank you to the payor. This lets them know that you did indeed receive their check, and you’re appreciative of it. Let them know you are grateful for their efforts and respect them for being respectful of your budget. A simple “Thank you for your payment” goes a very long way.
It’s always important to remember…tomorrow is another day. If your check doesn’t arrive today, there is always tomorrow. There will be prospects and opportunities around every corner. The possibilities are endless for the small business owner. Money is a HUGE part of running a business, but it’s not everything. Branch out a little; do something different. Start a new venue within your business to ensure your eggs aren’t all in one basket. A positive attitude is the best one to have. A creative mindset is essential to succeeding and if you possess both of these wonderful attributes….then you’re way ahead of the game and are sure to thrive both professionally and personally.
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