How to Make Sure Your Business Gets Paid on Time
Getting the sale and finally seeing that all your hard work has paid off is one of the best feelings a business owner can experience. It ought to be a straightforward process. You make the sale, ship on time, send the invoice and receive payment. However, what if the customer is simply taking too long? That can be a nightmare situation for any company, but it mostly affects start-ups. The following suggestions involve steps you can take to ensure that your company gets paid on time.
Make Payment for Your Customers Easy
Before you start sending strongly worded emails to your delinquent customers, it's important to first take a look at your system for making payments. Is it easy to follow? Does it do what you say it's supposed to do? Sometimes business owners discover that when they attempt to go through their own system it turns out to actually be quite difficult. Issues such as complicated navigation, lengthy processing and even the types of payment options offered might be preventing your customers from paying you on time.
Use a Factoring Company
Making sure that people not only receive their invoices on time but also pay them can be very challenging for any company. Therefore, many opt to work with a factoring company in order to make this process easier for everyone.
Usually, business owners will sell their invoices or receivables to a third-party financial company called a factoring company. This allows small businesses to receive instant payment as well as the benefit of having another company's support in the form of call centers and administrators. Invoice factoring has many benefits for companies involved in freight and wholesale.
Every company is seeking ways to pay less for the things they need. Why not take advantage of this? One of the best ways to make sure that you will be paid on time is to offer an early payment discount. These can range from 2% to 5% of the total price. This might not sound like a lot, but anywhere a company can cut costs is a win for them. Offering this incentive to your customers should result in much prompter payments.
Money is the name of the game when it comes to running a successful company. If the inventory is going out and payments are not coming in, there's a huge strain placed on your business. Try implementing some of the suggestions mentioned above in order to start getting your company paid on time.
Finances in business is huge, especially if the business is new. Click here to learn about dynamic pricing and how it may boost your business’ financial efficiency.