One of the most important aspects of running a business is managing cashflow, and in particular how quickly your customers are paying you!

Without timely payments from customers, the cash flow of your business will suffer, creating issues around the business paying staff and suppliers, not to mention yourself.

Do you have customers that are 30 days overdue? 60 days overdue? Or even 90 days overdue? Would you rather get paid on time? There are a number of things you can do to improve your outstanding customers and your positively impact on your cash flow.

What are your payment terms? Are you asking for payment in 7 days or on the 20^th of the month following?  Payment in 7 days is widely accepted in most industries these days and it also avoids the need to send out month end statements.

How quickly are you sending invoices? Are you invoicing on the job? If you use Xero, you can get the Mobile app which allows you to do this. The sooner the customer receives your invoice, the sooner they can pay it.

If you can’t invoice on the job can you email the invoice through at the end of the day? Email is much quicker and cheaper than posting invoices out. Most accounting software packages, including Xero, allow you to do this. And if you customers are using Xero, you can email the invoice straight into their accounting system so they won’t forget about it.  Give us a call if you would like to know more.

Do you ask for deposits or payment in advance?  For smaller jobs, you should request the entire payment up front.  For new customers and larger jobs, don’t be afraid to ask for a deposit.  You need to ensure materials and wages are at least covered while completing the job.  Also generate progress invoices for jobs that spread over a couple of months or longer.

How quickly are you getting paid? The best way to get paid quickly is to make it as easy as possible for the customer.  Can you get paid on the job? Are you able to accept Eftpos/credit card payments? All the major banks have products available that allow you to accept payments anywhere using your smartphone, iPad or Android device.

And it’s cheaper and easier than ever. There may be merchant fees attached but isn’t it better to get 97% of the sale today rather than wait 30 days or more for the full 100% or worst nothing!

Getting paid promptly is an important part of your business and we would like to help you achieve it. Ask the team at All Accounted For if you want to find out more.

Written by Allison Henderson