One of the first things I was taught as a salesperson was that nothing has been sold until the money is in.

Did you know that more companies go out of business through cash flow problems than for any other reason? And that would mean everyone in your company would be out of a job.

And, while we all like the opportunity to work with larger companies, it seems the bigger the customer is the more it behaves as a law unto itself and the longer it can take to pay its outstanding debts. Even though the government keeps making noises about improving the situation for smaller businesses, little of practical value appears to filter through – not much help if that customer is your customer.
Get your own house in order

Whenever a new customer comes on board:

• Be clear about who can authorise payment for any products or services you provide
• Know what needs to be signed or how they confirm an invoice is due to be paid
• Establish where the invoice should be sent
• Know whether reference to a purchase order needs to be made
• Make sure accurate invoices go out on time

The best way would be to avoid the necessity of chasing payment altogether by only providing the product or service on receipt of money, or offering attractive discount savings to encourage prompt payment.

However, if neither of these options is available to you or applicable to your business, ensure that you make one to one contact.

The telephone can be a very useful tool in chasing money, second only to presenting yourself at the customer’s premises!

6 useful Tips on chasing payment

Provided you know your own house is in order and there is no reason from your point of view that payment should not be immediately forthcoming, don’t be afraid to take these tips on board and state your case to errant customers.

• Be prompt in chasing – you’ve provided the service or product
• You are entitled to the money by the agreed time
• The longer you leave it to chase your money, the further down the queue you’ll go when the cheques do get written out
• If you are getting the run around from the customer company, the person who made the sale should speak initially to the Decision Maker who bought from your company – three reasons for this
• This is the person who values the purchase
• This is the person with whom your company is building an ongoing business relationship
• In short, this person has a vested interest in keeping you sweet – I can remember numerous occasions when I’ve been on the buying side of the equation and stood over Financial Directors and made them write out a cheque after I’d received a telephone call from a totally fed up supplier!
• Don’t back down – be prepared to state your case to the top man or woman
• Be pleasant but firm – no-one wins if a slanging match is allowed to develop

Taken from training material originally developed by Linda Mattacks