Posted: Thu 18th Jul 2013
Recent tightening of the money market has made banks ever more cautious in their lending decisions so speeding up slow payers is essential to ensure you have money to fund your business growth,Â writes Clare (left). After all, it's your money that late payers are using to fund their businesses!Â We've put together the following top 10 tips to help keep your business's cashflow on track.
1. Ensure your Terms and Conditions are up-to-date and they include payment terms and any interest you can apply for late payment. If you update your T&Cs, email a copy to all clients explaining that they have been updated and this latest version is the one you will be applying on all future business. 2. Quote payment terms on all quotations and tenders and state that the quotation is subject to your terms and conditions, which if possible should be printed on the reverse. Your client needs your terms of business when you quote or they accept the order. It is too late to just print them on the back of invoices.
3. Find out the name of theÂ person responsible for raising payment. They are your point of contact for payment - not the person who gives you the order. It is this person who will help your cashflow.
4. When you contact a customer for payment, note what is said and be specific about agreeing future actions and, if appropriate, confirm these by email. 5. If a promise of payment is made, ensure you diary forward to call them the day after payment is due, if it doesn't arrive or to thank them. 6. Never let chasing slide - be persistent - it is your cashflow that is suffering.
**7.**Â The more lenient you are and the more you let payment slide, the more your customers willÂ assume you don't mind waitingÂ and are prepared to extend their credit. Â
8. Be sure of your facts as slow payers often bring up spurious complaints or niggles. You need to be sure of your ground and nip these issues in the bud immediately. Try to avoid having to phone back to answer these queries as you may have problems getting through again. 9. Always be in control and don't let emotion come into it. Be calm and positive. You have every right to ask for payment; the only reason you are telephoning them is because they are late with payment. 10. If you don't like chasing money and your time is more profitably spent running your business, why not consider outsourcing to specialists, who will retain your customer goodwill, get you paid and keep your cashflow on track. Clare Hughes is operations manager for online credit controller and late payment chaser Cashflow Protector and also looks after their affiliate network Kasfhlow.
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