Customers who do not make payments cause cash flow problems for any small business.
Unfortunately, non-payments are unavoidable for most small businesses. However there are ways to minimise the effect non-payments have on your business.
Accountant Ready Services recommends the following:
1. Have a quote, letter of engagement or contract set up. These documents outline the expectations of each party over the course of a project.
2. Require a partial payment up front for all products or services (e.g. a deposit to cover your fixed costs).
Requiring a minimum deposit is fair and minimises risk of non-payments.
3. Doing too much business with one company can be like putting all your eggs in one basket. Try to conduct business with various customers of all sizes to avoid relying to greatly on one customer.
4. Have a terms invoicing period. Shorter terms are much better for your cash flow. If the non-payer has not paid for the service by the invoice date follow up by email then a phone call soon after.
5. Be consistent with chasing your non-payers. It is your money after all. Ensure you always contact them during reasonable hours and in a professional manner.
If you have been unsuccessful in chasing up non-payments and exhausted all efforts, contact us for a NO COLLECTION, NO FEE DEBT COLLECTION SERVICE!