One of the biggest problems a startup business man faces is actually getting paid for the products or services you provide. Large companies have problems with accounts receivables so that small businesses do should not come as a big surprise. But just how do you get people to pay up and better still pay up on time? Some pointers
Make the Invoices Clear – Ensure that the invoices you send are clear and contain all the information they should. People like to see what exactly they are paying for and not being able to do so may be the perfect excuse to ignore the debt for a while.
Be Firm but Polite – If an invoice is overdue your startup business cannot afford to ignore the issue. Make your collection phone calls between 930am-1130am (the best time to catch people at their desks) and make a firm but polite inquiry about the payment status on the invoice you are owed. Never be rude or abusive. You might feel like this sometimes, but it won’t help you get paid
Get a Firm Commitment – When making collections phone callsdo not allow yourself to be fobbed off with excuses (I’ll check and get back to you, the check’s in the mail etc.) Your objective here is to hang up with a commitment for payment right now, but if you can’t get that, then get a commitment for payment on a subsequent day.
Make it clear that you are serious by repeating it back to the customer; like ‘OK, so you will mail me your check for $xxx this Wednesday,the 21st, and I’ll receive it on Thursday the 22nd. Is that right?’ Then immediately email or fax the customer with a quick note stating ‘I confirm your commitment to mail us your check for $xxx this Wednesday, the 21st, to be received by us on Thursday the 22nd.’
Outsource – Collections and accounts receivable can be very,very tricky for the startup business. If unpaid invoices are becoming a problem for you act early and hire an outside collections firm
Getting tough with clients about payment can be hard for a startup business owner who might be tempted to let a client slide on payment for a while for fear that they will lose the business altogether. There are a number of good, affordable companies who specialize in small business accounts receivables specialize in small business accounts receivables and for a modest fee can help make sure that you get the money you are owed.
