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Don’t let late payers affect your business this year


Your business can suffer if customers do not pay on time, it can be challenging to manage your cash flow and accounts and in extreme cases some companies have faced closure.

 

Millions of businesses experience late payments from customers every year. Invoices state “payment within 30 days” but often credit terms are set at 60 or even 90 days nevertheless, this is not feasible for many smaller businesses.

 

Here are our dos and don’ts for managing late paying customers and late payments: 

Do:

  • Inform all customers in writing of your credit terms up-front
  • Invoice as soon as the service is complete or goods are delivered
  • Ensure your invoice states in small print that you understand late payment legislation and will implement it if necessary
  • Accrue a financial safeguard to cover you for any payment glitches
  • Consider invoice factoring, as this removed the pressure of late payments. You can read all about Invoice factoring in this compact article, click here.

 

Don’t:

  • Assume your overdue clients will pay, be active and stay in contact with them.
  • Continue to deliver goods or provide a service if the customer has overdue invoices, as this won’t encourage them to pay. In fact it will only add to the amount owed.
  • Become follow your customers’ example and become a late payer yourself, it is not a reputation that your business needs.
  • Allow a customer to become a repeat late payer. Be clear in your terms and state that the business can only function within them.

 

Late paying customers can really dent your cash flow; Alliance Commercial finance is an experienced invoice finance broker. We help businesses achieve their short-term and long-term cash flow goals.

 

Speak to a member of the team today on 01789 761374 and find out how we could help your business move forward!

 

 

Added: 25 Jan 2016 13:22


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