Rule One of Business: Get Paid
To get paid, just as you would realise is essentially the point at your business because if you are not paid, what are you doing in business?
You might be laughing at the heaps of business people who allow their customer base to simply pay when and if they feel like it. I know of a business owner who persistently collects bad debts like charms. For what reason? Simply because he cannot bring himself to demand the cash and lets people take advantage of him.
If you permit a client credit, do so only when they have cleared consistency to you by paying cash on delivery (COD) for some period of time. Furthermore, you need to check whether they have the funds to pay you - otherwise do not do business with them. Don’t fool yourself into the line of “I need the work” or “I need the sales”. It’s pointless when you do the service or providing the goods for nada if you are not paid.
If you are the kind of person who can’t demand the cash when the service has been finished, try these cheats:
Tell your client that when the service is completed, you need cash or cheque. They should probably have it to hand over at at the finish date and you will not need to request your money.
When you send out the quote, make sure your payment terms are plain.
Form an invoice that has your terms of payment evidently printed and hand the client the invoice when the job is done. They should review the invoice and generally realise they should pay you the fee now without you going to say a word. Fabricate a “vicious boss” who would skin you alive if you can not leave with the money for the work.
Ask your bank branch to provide you with Merchant facilities so you can have credit cards such as Mastercard and Visa. The majority of people have credit cards and it could cease the issue of the client not operating a cheque account or not having the cash on hand.
Alternatively, don’t be frightened to hold the promised goods until payment is paid. Know, until the goods are paid for, they are still yours.
If you decide you’re going to let a client credit, be sure you get the following contact details of them at a time BEFORE you let them credit.
- Name
- Address
- Phone number
- Bank name and address
- Account no.
- 3 trade references with their names, addresses and phone numbers
Once you record all this detail, call the branch and make for sure that they do operate an account with them. Then, contact each trade reference and ask if they pay their invoices correctly or if there have been any issues 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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