To get paid, you would imagine is fundamentally the point in your business because if you aren’t getting paid, what are you doing in business?
You would be surprised at the number of business people who have their customer base to simply pay when and if they feel like it. I know such a businessman who repetitively collects bad debts like accolades. How is that? Probably because he won’t bring himself to request the payment and people can just take advantage of him.
If you give somebody credit, do it only when they cleared themselves to you by paying cash on delivery (COD) for a period. Secondly, you need to gauge whether they have the resources to pay you – otherwise you shouldn’t do business with them. Don’t kid yourself into the line of “I need the work” or “I need the sales”. It’s ultimately to do the work or providing the goods for zip if you are not getting paid.
If you are the type of person who can’t ask for the fee after the job has been done, try these hints:
Tell your client that when the job is finished up, you will require cash or cheque. They will more than likely have it there at the point of sale and you won’t have to request your fee.
When you give out the initial quote, be sure your payment terms are understandable.
Do up an invoice that has the terms of payment simply printed and give the client the invoice when the work is finished up. They should see the invoice and simply know they will pay for it now without you having to say a word. Create a “nasty boss” who would burn you alive if you don’t bring back the cash for the work.
Organise your bank to have you running with Merchant facilities so you can accept credit cards including Mastercard and Visa. The majority of people own credit cards and it can fix the difficulty of the client not holding a cheque book or not having enough cash at the time.
Moreover, don’t be afraid to hold the promised goods till the payment is made. Don’t forget, until they have been paid for, the goods remain yours.
If you choose to let somebody credit, be sure you have got the following information off them some time PREVIOUSLY you permit them credit.
- Name
- Address
- Phone number
- Bank name and address
- Account no.
- 3 trade references with their names, addresses and phone numbers
When you take all this detail, telephone the bank branch and make for certain that they have an account with them. Then, telephone each of the trade reference and request if they pay their debts consistently or if there are any difficulties with them.
Most people will be willing to tell you if the person is troublesome. If everything is OK, allow them a moderate level of debt, say no more than $500 (depending on your business). Monitor the operation of the account for a few months before allowing this amount to be exceeded.
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