Rule One of Business: Get Paid
To be paid, like you would realise is vitally fundamental in your business because if you are not being paid, what’s the point in business?
You would be astounded at the loads of business people who only get their customer base to pay them when and if they get on with it. I am acquainted with such a businessman who repetitively gets bad debts like trophies. Why? Just because he can’t bring himself to request the money and allows people to use him.
If you allow somebody credit, do it only when they have proven their worth to you by paying cash on delivery (COD) for a time. Moreover, you should gauge whether they have the means to pay you - otherwise do not do business with them. Don’t kid yourself into saying “I need the work” or “I need the sales”. It’s pointless in doing the service or providing the goods for nothing if you aren’t getting paid.
If you are the type of person who can’t ask for the fee when the work has been finished, try these cheats:
Tell your client that when the service is done with, you require cash or cheque. They should be likely to have it to hand over at the transacation and you do not need to demand your fee.
When you give out the initial quote, be sure your payment terms are plain.
Complete an invoice that has your terms of payment evidently listed and send the customer the invoice when the work is done. They will look at the invoice and immediately understand they have to pay it off now without you being required to say a word. Fabricate an “evil boss” who might skin you alive if you don’t leave with the pay for the service.
Organise your banking to hook you up with Merchant facilities so you can accept credit cards like Mastercard and Visa. The large majority of people own credit cards and it can stop the difficulty of the client not owning a cheque book or not having the right amount of cash on hand.
Moreover, don’t be persuaded against to keep any goods until after the payment is made. Know, until the goods have been paid for, they remain to be yours.
If you choose to permit a customer credit, make sure you get the following information off them a week PREVIOUSLY you permit them credit.
- Name
- Address
- Phone number
- Bank name and address
- Account no.
- 3 trade references with their names, addresses and phone numbers
After you record all this information, ring the bank branch and make for certain that they do operate an account with them. Then, ring every trade reference and ask if they pay their fees on time or if there are 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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