Tips for managing credit control, day-to-day
Managing credit control is a long-term process, especially if you want to do it right. For small businesses, this can be daunting, and it often isn’t your main concern as an owner or proprietor. Fortunately, there are some basic rules that can help you to manage your credit, both short and long-term.
Manage your time
The first and simplest step is to invoice early. Getting this sorted as quickly as possible ensures that your invoice will be due in good time. You should also set aside time to deal with invoices. It can be awkward to chase payments, and that can make people delay it, but that is never the answer. Set aside time each week to chase up invoices.
Do not take new orders until old ones are accounted for
If you have a number of repeat customers, then they should not be given too much flexibility. Depending on the situation – sometimes late payments are unavoidable – you should aim to accept new orders only from customers that are up-to-date on their previous invoices. It is obviously difficult to turn down new business, but sometimes it is the best way to proceed.
Manage your customers well
It is important to make sure that your clients like whatever they get from you. Providing a high quality of customer service will make it more likely that your customers will pay on time. So make sure purchases arrive as described, and that services are completed to an excellent standard. Though this sort of responsibility falls primarily into business as usual, it can go a long way to sort credit issues.
Work out the costs
You should always be aware of how much money you are owed, as well as staying aware of what this costs you. Knowing that you are owed money, and potentially losing money as a result, is an excellent way to make sure you stay motivated to get your invoices paid in good time.
Consider debt collection agencies
If you do not have enough time to chase debts, then an agency can help. They are experts in this field, and they will be able to deliver results. Very often, these agencies will be able to employ tactics that might not occur to you.
For small businesses, late payments can be a real hindrance – but following these steps can be an excellent way to eliminate risks.