Continuous late or delayed payments can very easily bring a startup business to its knees. A healthy cashflow allows businesses make the required investments to grow. A firm hand on spend and income is really important for a Startup to be successful.
Customers are key to this as most of the business income will come from invoices that have been sent out in return for goods and services they have procured.
It isn’t uncommon to find customers that wouldn’t bust a gut to pay their dues on time. If you run a business, here are seven ways you can get your money’s worth on time.
Bill on time
Have a set time of the month to verify all invoices have been sent. A lack of organisation could result in your customers receiving an invoice too late to meet your payment target date. You might also overlook certain areas that have been charged resulting in lost payment.
Reduce the stress on customers and make it quick and easy to make payment using a mobile and online system. Google Pay, Amazon Pay, Paypal, Apple Pay and Stripe are some more popular choices with online businesses today.
Hire a watchdog
In other words, hire a book keeper or book keeping service to keep track of where the money is being held up and do the follow up. A book keeper can help prevent errors with invoicing as well as manage your company cash inflow and outflow.
Maintain a professional client relationship
Business is Business and fees are due after you have delivered a good or service. Gratitude isn’t an acceptable form or payment if you are in business to make profit unless you see this as a means of increasing customer loyalty and expect more business in the longer term.
Have an agreement
The terms of your agreement covers what you are billing for, make this clear and obtain an agreement before proceeding with the work. Ensure this is mapped out clearly on invoices to avoid delays with clarification. Itemise all necessary areas, such as quantity, hours worked, discount if any or VAT.
Offer a payment plan
Give customers a flexible option for payment such as spreading the costs and offer incentives for quick payment. If you pursue a flexible option for payment ensure you have a water tight agreement in place.
Have a late payment policy
Ensure this is set out clearly from the onset in the terms of your service as it shouldn’t come as surprise to your client. Send a courtesy reminder about late penalties to the client before your deadline and ensure whatever you charge, it is in line with the laws in your area.
Are there are other strategies you use to ensure prompt payment from customers? Let’s continue the discussion, Join our community for more business tips and share yours with other entrepreneurs.
Dee is a mum, business transformation coach and brand strategist. She has worked with Fortune 500 businesses on executing multi million dollar projects. She teaches Startups how to effectively launch and grow their business.