Getting Paid on Time

If your business provides services to other businesses or major services for individual customers, you’ll often be called on to provide the work ahead of payment. Making sure that payment comes in on (or at least near) the time specified can be the difference between a job that was worthwhile and a job that merely helped to keep you afloat.

This sort of day-to-day trouble is a source of frustration for many businesses, and for good reason!

Here are a few of the tricks we know from our clients can be successful:

Plan Your Financial Year

While we’d all love to be busy all year round, almost every business will have quiet or quieter periods as well as times when the work seems to come in so fast you can’t keep up!

For example, as accountants, we’re at our busiest in the run-up to tax season, but we get smaller peaks of activity at the end of each quarter. Florists will always be busiest in February, and plumbers and roofers can expect many more emergencies and much more out-of-hours work in the winter months.

This doesn’t help you get paid so much as give you an understanding of when you have to push hardest (to help with weaker months) and when you can chase a little more slowly (as enough other revenue will be coming in.)

Clear Payment Terms in Advance

Written agreements you make should always specify the payment terms you expect. Remember, most organisations do have some room to negotiate on specifics!

Make sure you’re happy with whatever payment terms are agreed before any work is done, mark out when you expect payment in your calendar to check, and we also highly recommend making sure the person you’re negotiating with hears those payment terms and knows what you expect verbally.

That can feel like you’re being pushy, and it definitely has to be handled with tact, but it makes sure this information is at the front of their mind too.

Risk Management

We’ve all heard stories of businesses that just never pay for the services they receive. Sometimes there are even good reasons, but it can be worth tracking those businesses you have the most trouble with.

This doesn’t mean never doing business with them again, but it may mean requesting payment up-front, or deposits, or simply very short payment terms for invoices so that work can be stopped on nonpayment. Typically this does mean that the payment is made in timely fashion.

Chasing for payment takes time and effort, and it’s sadly a necessary part of operating in these markets. However, if care is taken and a solid reputation is built, it can become less of an issue over time.

To help you keep your books balanced and understand the full extent of what better payment recovery strategies can do for you, why not get in touch? We’ll be happy to help.