Collect your Debtors Faster - Bizdom Business Coaching Hawkes Bay

Blog
Events
News

FEATURED.

Getting Your Business Through Winter Illnesses

Vik. BUSINESS PLANNING, LEADERSHIP

It’s the perfect storm: the ongoing threat of COVID-19 converging with seasonal influenza. Not only can these illnesses wreak havoc on people’s health, but they can also impact your business. One study found that employees who come to work sick cost employers twice as much in productivity losses than employees who stay home. And while many […]

READ MORE
Back to the BLOG page

Collect your Debtors Faster

Posted 4 years ago in BUSINESS PLANNING

Did you know that even though you haven’t collected your debtors, you still have to pay tax on them?

This is because you pay tax on your sales figures irrespective as to whether or not you have collected the cash.  So use these ideas to collect your debtors quicker:

  1. Agree your payment terms at the time of sale
  2. Get terms of trade signed off in writing before you start the job
  3. Include a guarantee in the payment terms
  4. Invoice as quickly as you can
  5. Ask for a deposit
  6. Change your payment terms to 7 days or ‘on delivery’
  7. Send statements with only 2 columns – current and OVERDUE
  8. Follow up the day after the due date
  9. Put someone other than the business owner in charge of collection – owners are usually too soft!
  10. Document what your customers have promised in terms of payment and hold them to it
  11. Use a debt collector sooner rather than later – the longer you leave it the harder the debt will be to collect
  12. Stop credit for customers who are late on payment

How many of these ideas have you adopted in your business?  How many are you actually applying?

Don’t procrastinate on your debtors.

 

It’s the squeaky wheel that gets the oil – Anon

*Mandatory fields. Your email address will not be published.*