Getting paid, just like you would figure is essentially the point to your business because if you do not get paid, what’s the point in business?
You would be astounded at the heaps of business people who only have their clientele to pay up when and if they feel like it. I know of a businessman who always gets bad debts like accolades. For what reason? Very possibly because he won’t bring himself to demand the cash and people can just overpower him.
If you let somebody credit, only do so after they cleared their integrity to you by paying cash on delivery (COD) for a time. Moreover, you need to gauge whether they have the cash to pay you – if not then do not do business with them. Don’t fool yourself into the pattern of “I need the work” or “I need the sales”. It’s damaging doing the job or providing the goods for free if you aren’t paid.
If you are the sort of person who can’t demand the cash after the service has been completed, try these cheats:
Tell your customer that when the work is finished up, you will need cash or cheque. They should more than likely have it ready at the transacation and you won’t have to ask for your fee.
When giving out an initial quote, make sure your payment terms are understandable.
Do up an invoice with your terms of payment plainly stated and hand the customer the invoice when the service is done. They should look at the invoice and generally assume they should pay you for it now without you having to say anything. Make up an “evil boss” who might skin you alive if you can’t leave with the money for the job.
Organise your bank to provide you with Merchant facilities so you can accept credit cards including Mastercard and Visa. The large majority of people possess credit cards and it will cease the dilemma of the customer not having a cheque book or not having the cash in their wallet.
As another option, don’t be asked not to keep hold on the goods til you have been paid. Understand, until they’re paid for, they still remain yours.
If you plan to give a customer credit, make sure you get the following contact details from them some time PREVIOUSLY you give them credit.
- Name
- Address
- Phone number
- Bank name and address
- Account no.
- 3 trade references with their names, addresses and phone numbers
Once you have all this detail, contact the branch and make for certain that they do have an account with them. Then, call each trade reference and request if they pay their debts consistently or if they have had any issues with them.
Most people will be willing to tell you if the person is troublesome. If everything is OK, allow them a moderate level of debt, say no more than $500 (depending on your business). Monitor the operation of the account for a few months before allowing this amount to be exceeded.
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