If you run a business, ensuring that funds are deposited into your account on time is vital. For most business owners, funds from their clients or customers are essential for paying company bills and ensuring that the cash flow of their business is running smoothly. However, as any business owner will know, payments are not always prompt.
Clients can forget or sometimes even downright refuse to pay, funds can take longer than expected to be transferred, and other issues can crop up for which you might have to agencies like Elk Grove Village IT Companies, and cause disruptions with cash flow. Thankfully, there are several things that you can do to make the process of managing cash flow easier by streamlining payments. Here are some of the best options to consider.
#1. Direct Debit Payments
If you run a business that sells products or services on a subscription or contracted basis, then it’s likely that your clients will need to make a regular payment to you each week, month, or quarter. When you are relying on a regular payment to come in so that you can cover your own business expenses, a client forgetting to make the payment or missing their payment date can cause a whole number of problems for you. Instead, use direct debit services for businesses, which will require your clients to set up a direct debit payment; this will make the process easier for all involved by transferring the funds automatically from their account to yours. This way, you can expect the payment to be made on time and your client won’t need to remember to manually make the payment to you each month.
#2. Invoice Factoring
If you receive your business incomings through invoicing, then you might want to consider using an invoice factoring service if you are experiencing a lot of problems with non-payments or invoices being paid late and causing you to be late with paying your own bills and expenses. An invoice factoring company will usually cover the cost of most of the invoice on behalf of your client, keeping back a small percentage for themselves by way of a fee. This will ensure that you have the funds available exactly when they are needed, rather than having to wait for your client to pay.
#3. Outsource a Collections Company
If you are having trouble with the non-payment of invoices in your business, then trying to chase everybody up and get them to pay can take up a lot of your valuable time and energy. Along with this, chasing clients for money owed can also become very costly, causing your business to lose even more money as a result. In this case, it might be a good idea to outsource the collections work to an outside collections company who can work solely on chasing the clients in debt to you and working with them to come to a solution regarding making repayments. With a collections company working for you, you can focus your time and energy on growing your business and brand.
#4. Send Invoices Electronically
If you are still sending paper invoices through the post, then now is the best time to stop and upgrade to a more streamlined, efficient and effective method of requesting the money that is owed. Electronic invoices are a far more convenient solution for both you and your clients since they can be sent within a matter of seconds and incorporate easy payment options, such as a click button which takes your client straight to a payment page where all they’ll need to do is enter their card details. This is a far better alternative to paper invoices, which are much easier to lose or forget about!
#5. Change Invoice Wording
If late or missed payments are a problem for your business, then simply changing the way in which your invoices are worded could have a positive impact on streamlining payments. Bear in mind that some clients may be unable to understand technical jargon, therefore it’s important to write all invoices in layman’s terms to minimise the risk of misunderstandings. On top of that, it’s a good idea to use polite language – say please and thank you – it’s very simple, but it can go a long way!
Let us know if you found these tips helpful!