How To Get Paid On Time

Bad debtors can spell disaster for small businesses, many of which have neither the finances nor resources to employ one or more full time credit controllers. If outsourcing sounds a better option for your business and you would like to learn more about our outsourced credit control services, then we would be happy to take your call.

If you are starting up a business, you may be wondering what control measures you can put in place to ensure your customers pay on time.

Step 1: Verify your customer’s details

Before doing business with a new customer, it is important to obtain and verify the customer’s information, The trading style is very important.

Are they a limited company or a sole trader. What is the correct legal name of who you are doing business with.

  • Business Name
  • Name
  • Address
  • Telephone Number
  • Email Address
  • Bank Details

You may wish to capture the customer’s details on a new customer application form, or in a formal contract. A contract can help to prevent late or non-payment as, by signing this document, the customer is accepting and agreeing to adhere to your business terms and conditions.

Step 2: Consider performing a credit check

Before offering credit to a new customer, we would highly recommend that you perform a credit check.

A credit check will give you insight into the customer’s financial history, their past borrowing habits, any current credit arrangements and how likely they are to repay you.

With this information to hand, you can make an informed decision about how much credit to offer, if any at all.

Step 3: Maintain open communication

Communication is key to the success of many things, business sales included. With this in mind, you should keep communication channels with your customers open, so that any issues can be addressed promptly.

Don’t forget to let your customers know who they should contact if they have a query or concern.

Step 4: Raise an accurate invoice with clear payment terms

Often when an invoice has not been paid, this is due to a clerical error or incorrect customer details being recorded. To avoid such issues, you should confirm with the customer, at the point of sale, who to address the invoice to and where to send it.

This information is known as the customer’s billing details. The customer may wish to provide you with different delivery details.

We would highly recommend that you include clear payment terms on your invoice template, as well as the due date for payment.

In addition, you should send out statements of accounts either monthly, quarterly or annually, depending on the specific needs of your business. If an invoice has not been settled, a statement highlighting the overdue amount is often enough to give the customer a gentle nudge to settle their debt.

Step 5: Have a robust credit control procedure in place

No matter the size of your business, a robust credit control procedure is vital to protecting cashflow and keeping your business a-float. This is something you may choose to implement in-house, or you may prefer to outsource your credit control in part, or full, to Jackson CRS.

If you would like to know more about our credit control and debt recovery services call 01603 319034 or email: info@jacksonscrs.co.uk for a free no obligation chat about your needs and how we can help.