It’s no secret that business needs a steady flow of cash to survive, maintain and grow.
Here are 4 ways to ensure the money coming into your business is as regular as possible.
1 – Agree payment terms in advance
This is quite often the most vital step. Talking about getting paid when agreeing when you’ll do your bit in terms of delivering goods or services is the key. That way everyone knows what is expected. And talk about this as well as putting it in writing. Speaking to your customers is the best to build trust.
2 – Invoice quickly
For goods, this must be no later than at the point of delivery. For services, certainly no later than completion but bill in installments where possible.
3 – Get paid by direct debit
We still see businesses allowing customers to pay by cheque. This adds days if not weeks for cash to appear in your bank. There are so many ways to get paid today including PayPal, GoCardless for direct debits, Stripe for card payments…. think about how you can bring these payment methods into your business.
4 – Chase up overdue invoices urgently
You should have a system in your business to alert you once invoices are overdue. Follow up immediately. There are ways to automate this process such as invoice reminders, automated chasing emails etc. Remember when it comes to chasing up money that “polite persistence pays”.
If you’d like to get all of the above systems setup in your business in a more automated way, then talk to us.
We’re experts on Xero and related apps which can help get cash flowing back into your business bank account.
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