The 9 Things A Small Business Can Try to Get Paid On Time

1.Get it in writing. Have an engagement letter or services agreement to protect your
legal right to be paid fairly for services rendered.

2. Get a deposit or a retainer. This helps to reduce your overall financial exposure.

3.Get your invoices out quickly. The longer you sit on your bills, the slower you will get paid.

4. Communicate early and often. Customers tend not to pay quickly or at all when
they are dissatisfied. Reach out to them right away if there is a problem or a dispute
and talk it through. Be ready to compromise if their complaints or concerns are legitimate,
but only in exchange for prompt payment on the adjusted balance.

5. Establish budgets and target ranges. Customers hate surprises. If the bill is much
higher than expected, they might delay payment in protest.

6. Get creative. Can you include mutual incentives for prompt payment? Can you
break payments into installments? If you make it easier and more rewarding to help
them pay you, you might get paid faster.

7. Establish mutually beneficial and dynamic relationships with your customers and
clients. Customers will pay faster when they like you, appreciate your product/service
and feel as though it is a two-way street.

8. Try the carrot before the stick. If a customer pays late, don't threaten them with
litigation until you first try to work things out. A reasonable approach is less invasive
and less stressful. It can also save your business relationship.

9. Protect against the inevitable. If you know that customers or clients will pay late, then make
sure you have a line of credit or access to financing to cover cash flow gaps. Your business is
a car. You are the driver. Cash flow is the gas that makes your business go.

No comments:

Post a Comment