5 tips that would help you in dealing with outstanding invoices and result in the success of your business
Cash Flow cripples companies of all sizes. If your money is not in your bank account, you can’t spend it on the things that you need, and often not the customers you expect who will be late in paying your invoices.
You have got to set your invoice terms and you’ve got to enforce them as well, therefore once you have done the work and you send the invoice out it must carry the invoice terms, because you only have a certain amount of time in your business to run it, and you can only work with certain people, certain customers to become a profitable and cash-flow positive company.
For your business to grow, you have to work with the right customers engaging with your business.
It comes back to the adage about trying not to spend 90 percent of your time dealing with the 10 percent of your customers who are the most demanding.
If you are spending time working on clients/customers who, for example, aren’t appreciating the service you have been providing or are continuously slow in paying, you could be devoting your resources to a direction that could be completely wrong for your business as well.
Tips for chasing up invoices to help maintain positive cash flow:
- Make it a part of your everyday job: If you are a business owner, debt collection is a priority it is money owed to you, make it a part of the role that you do. It doesn’t matter how busy you are; it’s an important part of your business.
- Schedule it during business hours: You can’t be calling people and chasing them on a weekend when they are not taking calls. You have got to prioritise
- Compromise can benefit you both: Working out a regular payment system with the client/companies who struggle to pay you on time is a good positive cash flow option and it helps you work out your budget at the same time.
- Use a software accounting tool: Using appropriate accounting software not only helps businesses keep accurate records and provide timely updates as to the status of invoice payments, but can also prevent debts from aging without being noticed by the creditor. For example, reminders may be automated, reducing the risk of overdue invoices being overlooked and forgotten about until it might be too late.
- What goes around, comes around: When you are dealing with customers who will be telling you, ‘Look, I just don’t have enough money to pay you right now’ or ‘I have a cash flow issue myself’, you can sympathise of course. However, be careful because their cash flow issue will become your cash flow issue.
If you think this may be too much for you to handle and doesn’t let you concentrate on your core offerings, don’t worry, we maybe able to assist. This is your money – perhaps do what you do the best and outsource the rest.
Pendragon can help you run your business more efficiently, saving you time and money.
For further information please don’t hesitate to contact us, book an appointment or reach us at [email protected] or 02 9407 8700 where one of our Australian team members will gladly help you.
