Should I give up or should I just keep chasing payments?
Updated: Jul 21, 2020
Sorry but Adele’s Youtube video popped up as number one search result when researching for this blog, I couldn't resist.
But the answer is this-
Don’t give up!
That is your money, it’s what you agreed and what you are due.
Government figures published last year indicate that small and medium-sized businesses as a whole were owed £23.4 billion in late payments businesses need to review their processes and get these figures changed.
But how can you better your credit chasing?
Now obviously I would say this as a bookkeeper, but it really is a good idea to outsource your payment chasing for a number of reasons.
Time savings – The number one issue on most small business owners list of problems (besides not getting paid) is ‘Not enough time’. Chasing payments is very time consuming, multiple unanswered emails, phone calls, letters. Do you have extra hours in your day to spend making stressful phone calls? Wouldn’t it be more beneficial for you to be making a sales phone call or a productivity meeting?
Improved customer relationships – Businesses are built on relationships and customer satisfaction. I have heard time again, “Oh he’ll pay me one day, he’s an old friend” It’s funny how quickly relationships can change when money is involved and sometimes people will try to play on your emotions to get away with things. But is that fair to you? By outsourcing to a professional you remove the emotional aspect. You can maintain your good relationship with your customer, whilst providing a professional service. Your bookkeeper can build a good solid and professional relationship with the accounts department of your customer or directly with the customer themselves and sometimes this is enough to ensure timely payment. Serious Business- A business with multiple departments seems bigger, more successful, more serious. People don’t need to know that you have an outsourced accounts person doing your credit chasing. We can act under the umbrella of your business and be the (virtual) accounts department. This can give you much more credibility as an established business. People are less likely to miss payments if they think they are dealing with a bigger establishment.
Improved cash flow – Chasing payments may not be high on your list of jobs to do but it will be to your outsourced provider. Keeping on top of debtors and keeping the money coming in is top of the list, as that is what you hired us to do. Knowing when the money is coming in helps you plan for growth, and production, maybe even a bonus or a holiday.
Accuracy – we can keep an eye on what is paid for what. If you just look at your bank balance you could think that the customer is up to date. But did you forget that they were invoiced twice this month and still haven’t paid the previous month. Having access to every payment and every invoice allows us to keep track of where the account is up to especially if part payments are made. This ensures that things aren’t missed and you get every penny that you are owed.
Up to date Tech– Bookkeepers have a wealth of knowledge regarding the different payment methods available and different ways to ensure that there is no excuse for not paying. We can also help with credit checking your customers to see if you can take the risk of allowing them payment terms.
As with any outsourcing obviously you will have to pay out for something that you could 'do for free', but is it free? Think about your time, how much is that worth? What is your hourly rate? Where could you better spend your time?
Get in touch if you would like to discuss further and let’s make a plan for getting you paid!
t: 0161 501 0011