Cash flow is the lifeblood of your business. This means that to maintain that life-giving cash flow, you need business clients who pay on time and in full. But this isn’t always going to be the case, especially considering the current economic climate. As such, it’s possible that you’ll encounter a more than average number of slow-paying clients. In response to this issue, some businesses have begun offering discounts as an incentive for customers to make faster payments. What this does, though, is bring in less money for the same amount of product or service.
Below are a few tips to help you avoid payment issues with customers, and boost your cash flow:
Know your new clients. When a potential new client comes your way, do your homework. This means getting background information such performing credit checks, getting business/industry references, etc.
Nurture your key clients. It’s possible you rely on a number of key accounts for your cash flow. Maintain regular contact with these clients, and regularly review their payment patterns. If you discover they are paying slower than usual, don’t hesitate to contact them immediately.
Track your finances. Without an accounts receivable system in place, it’s like trying to steer a ship without a rudder. A well-organized system that is adhered to consistently will facilitate a healthy cash flow. It will also facilitate smoother business relationships with your clients.
Have a backup. Many small businesses operate at the very edge of financial failure. Creating a financial reserve is highly recommended. It minimizes your risk of failure, and provides a backup during tough financial times.
Offer payment options. You can often get payment faster when your customers pay with credit cards or online banking methods rather than with checks.
The Jayaram Law routinely and successfully assists its clients in their business-to-business (b2b) collection needs. We take pride in obtaining payment on accounts receivables without fracturing critical business relationships or engaging in time-consuming and costly litigation efforts.
If you need business debt collection services conducted in a professional manner, contact our B2B (business-to-business) debt collection law firm by calling 312.454.2859 or visiting www.jayaramlaw.com.