When it comes to running a successful business, one has to not only be committed and hardworking but also be willing to employ the very best strategies in everything that they do. And that’s the same kind of energy you’ll have to do when seeking to smooth the process of receivable collections. Without further ado, here are 5 strategies you can use without having to strain way too much:
A Reduction in The Terms of Payment
In order to ensure your receivable collections are running smoothly, your first order of business should be reducing the terms of payment. One way you can do that is by sending bills as well as invoices via email. The use of email is not only fast but absolutely free. And by so doing, you’ll end up saving yourself, as well as your esteemed clients, a boatload of hustle and money.
Establish Clear Credit Policies to Be Followed by Each and Every One of Your Employees
Apart from motivating your employees and making them feel like part of your organization, it is important for you to always reiterate on the importance of following the credit policies to the latter.
In as much as it is okay to award discounts especially to the most loyal customers, it is very important for you to avoid the temptation of extending way too much credit as doing so will only end up hurting your business.
Your clients should also be prepared for a credit history background check before awarding them any credit. This is important as it will shield your business or organization from doing bad business.
Encourage Fee Financing
For those clients who cannot make their payments on time, or may seem to struggle a little, then you might want to introduce them to this kind of payment. Fee financing accounting will allow for the so-called ‘silent middleman’ to cater for their invoices in full then they end up making monthly instalments.
This is very important as it will give them the chance to not only clear their invoices but at the same time still have a respectable amount circulating within their business or organization. Feel free to also do the same if you must and everything will work out in your favour.
Hire an Accounting Company to Help You Out
Having a trusted accounting company working on your finances will not only make the work much easier but will also improve the cash flow within your organization. This is because they have been around this proverbial block a few times and will do just about anything to take the workload off your shoulders.
And the fact that they will get to do this at a relatively low fee is the exact reason why you need to work with them. Doing so will also increase your level of productivity as you can now focus on other aspects that need attention.
These aspects will include running your business as well as advertising it to the public. But one thing you’ve got to do is making sure you’re handing over your financial load to an accounting company that is capable of handling things the right way.
Communicate with Client Before Making Collections
In business, brushing shoulders with clients who are hard on making payments is quite inevitable. But even so, it is important for you to handle yourself with all the professionalism that you can master. And that’s exactly why making collections through a collections agency should always come as a last resort.
And before going down that road, it is imperative that you make an effort to reach out to your client and find out the reason behind the delayed payments. That way, you can get to the bottom of things before worse comes to worst.
But if the client isn’t cooperative, then you can always do what you have to do with a clear conscience knowing that you tried your level best. At the end of the day, not every deal will fall through and you should be ok with that.
Apart from incorporating all the five strategies to improve your receivable collections, it’s important for you to also pay attention to the overall wellbeing of your business. You can do so by making sure you are only dealing with the best employees who are not only motivated by also happen to be highly skilled.
Besides that, it is very important for you to boost your management. If you have stronger management, you’ll find that everything you get to do, including the process of receivable collection, running smooth.
And when everything runs smoothly within your business and organization, you’ll always have the chance to not only get things done within record time but also save a lot of monetary resources while you are still at it.