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Making Sure Your Customers Pay On TimeMonday 05/21/2012
DwayneDwayne Briscoe / Bookkeeping-Results, LLC
Owner / QuickBook Pro Advisor

888-692-2083 / 713-898-1648

www.bookkeeping-results.com
How To Make Sure Customers Pay You On Time

 

Every business and membership-driven organization deals with this problem on a continuous basis.  Someone that they have worked with for a while takes longer and longer to get you paid.  They said that they’re waiting on their customers in paying them, and as soon as they get their money you’ll get yours.  How often has that happened to you?  More often than not I’m sure, and it has never been more prevalent than in 2012.  Yes the economy is getting better, but because you allowed it to happen to customers so often before, they just feel like it it’s still “okay” to be a little bit late since you didn’t complain before.

 

The Kauffman Foundation, an organization which has focused on entrepreneurs since its inception in the mid 1960’s, it has become a recognized leader for businesses both small and large, from a variety of levels in helping provide leading research into helping mature the small business.

 

One of the many research studies which were performed, was noting the payment cycle of customers to business owners.  In the early stages of this last recession, 2% of small business owners said that getting paid on time was their #1 issue.  However in 2009 that number grew to 12.8% and as high as 14.1% in 2010, which shows an 86% jump in only 2 years.  However with the economy coming back though in 2012, are your customers still being slow in payment?  When was the last time you checked your Accounts Receivable Report? 

 

With the continued stranglehold of business loans and lines of credit still out there, it’s still not an easy task for finding appropriate cash flow in order to continue a small business these days so there are alternatives you can consider:

 

1.         Complete weekly reviews of your Accounts Receivables Report and constantly follow up through written notices and personal telephone calls to customers who fall more than 1 week behind in their terms agreement for payment.  Explain that you are merely keeping on track with your vendors as they are, and value their business just as much as anyone else.

 

2.         Perform regular credit checks, especially on new clients, through credit reporting bureaus.  This is especially important for new clients if you are being asked to extend credit.  Also limit the amount of credit, with a potential deposit up front before completing an order.  This is not out-of-the-ordinary and often standard business practice for well-established companies.

 

3.         Do not consider a new customer placing a new order as it being necessary to “bend over backwards” in making sure that you get that signed agreement without checking their background first.  Unless you can afford to not recoup any monies from this new customer without the proper documentation, if it’s too good to be true, it usually is.

 

4.         Constantly be aware of how much can you afford to lose should a client potentially go bankrupt and research the rules and regulations for going after their assets should that opportunity arise.  It’s a last resort measure, but it’s something that every business owner should be prepared to do, because it’s ultimately your money and your reputation on the line.

 

 

About Our Show Advisor: Dwayne Briscoe is the founder and owner of Bookkeeping-Results, LLC.   Dwayne began his company in January 2007, based on the foundation to educate small business owners and bookkeepers who use QuickBooks®.  Working as a full-charge bookkeeper and trainer in a variety of industries for over 15+ years, he is a certified Pro Advisor with 5 certifications, including Enterprise Solutions and Point of Sale.  He is also an instructor at Brazosport College in Lake Jackson, where he teaches basic accounting, QuickBooks®, and basic payroll, along with hosting his own private classes.

 

Bookkeeping-Results, LLC has focused more on quality and not quantity for their clients, by paying attention to the details.  Through regular continuing education participation, as well as exploring additional ways of “thinking outside of the box” to help expand people’s knowledge of their own financial well being, it’s important to focus on not only saving the client money but also making the client money.

Previously broadcast from:
SKL @ BlogTalkRadio.com 11/07/2011 - 01/03/2014
CBS Radio's Talk 650 10/12/2009 - 07/01/2011
CNN 650 Radio News 11/08/2006 - 10/08/2009
KSEV AM700 04/04/2005 - 10/30/2006

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