Rule One of Business: Get Paid
Tuesday, May 25th, 2010To get paid, like you would realise is fundamentally fundamental to your business because if you aren’t being paid, why are you in business?
You will be astounded at the loads of business people who permit their customers to simply pay when and if they get around to it. I am acquainted with such a businessman who always collects bad debts like accolades. Why? Simply because he won’t bring himself to demand the payment and lets people take advantage of him.
If you give a client credit, only do it if they have proved their worth to you by paying cash on delivery (COD) for a while. Also, you can see whether they have the means to pay you - if not do not do business with them. Don’t push yourself into the line of “I need the work” or “I need the sales”. It’s fruitless in doing the work or providing the goods for nada if you don’t get paid.
If you are the sort of person who can’t request the payment even after the work has been completed, try these cheats:
Tell your client that when the service is finished up, you will require cash or cheque. They should probably have it ready at the transacation and you do not have to ask for your money.
When you send an initial quote, be sure your payment terms are visible.
Form an invoice that has your terms of payment plainly listed and send the customer the invoice when the job is done. They can review the invoice and generally realise they will pay you the fee now without you being required to say anything. Manufacture a “nasty boss” who would skin you alive if you don’t bring back the money for the job.
Set up your banking institution to hook you up with Merchant facilities so you can use credit cards like Mastercard and Visa. The majority of people use credit cards and it can solve the problem of the customer not owning a cheque book or not having enough cash in their wallet.
Otherwise, don’t be persuaded against to hand over your goods till after the payment is made. Remember, until they’re paid for, they still remain yours.
If you decide to allow someone credit, make sure you have got the following details off them at a point PREVIOUSLY you let them credit.
- Name
- Address
- Phone number
- Bank name and address
- Account no.
- 3 trade references with their names, addresses and phone numbers
When you possess all this detail, ring the branch and make sure that they operate an account with them. Then, call each of the trade reference and inquire if they pay their fees on time or if there have been 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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