We all understand that not collecting payments on time has as a severe impact on your cash flow, but let's not forget also that you are effectively giving your clients, your debtors, interest-free credit, and this also has an impact on your cash flow and your profit. Whatever the size of your business - start-up, sole trader, micro business, small business or SME - the remedies are the same. Follow these four steps and you will reduce the amount of money owed to you: send out the invoice as soon as you ship the goods; call the client the day after you send out the invoice to check the invoice has been received and there are no issues with the goods or services supplied; call the client 5 days later to carry out the same checks, so that there no excuses on that front; and call the client 5 days before you expect to get paid to make sure your invoice has gone into that month's payment run. Pretty obvious really, but it is surprising how many companies are not doing that. DSO - … [Read more...]
Collecting cancellation fees
People don't like paying cancellation fees even if they are aware of them when they book their appointment, to the extent that charging a fee often results in the client going elsewhere. No easy remedies Apart from asking for a non-refundable deposit, there are no easy remedies. Charging a cancellation fee to their credit card leaves you open to the client disputing the charge and claiming a refund, the excuse being: they did not receive your service, they were not aware of your cancellation policy (even if you did tell them), and they did not authorize the charge. Avoid cancellations in the first place So, by far the best way of reducing lost revenue is to avoid the cancellations in the first place. Send the client a reminder 24 hours before the appointment either by SMS, email or phone and get a confirmation of the appointment; Ensure your staff are well trained to handle objections and secure the appointment; Survey the clients to find out why they cancel and address the … [Read more...]
See our latest presentation
Customers and cash. How to get more of both! In difficult times most SMEs need to get more of one and conserve the other. In fact many would like to get more of both. Our latest presentation gives ideas and tips on how to do both. Feel free to comment on the presentation and we look forward to receiving your feedback. … [Read more...]
