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Rule One: Get Paid !

To be paid, as you would imagine is vitally the point to your business because if you are not paid, what are you doing in business?

You might be surprised at the heaps of business people who permit their clientele to make payment when and if they get around to it. I am acquainted with such a businessman who persistently collects bad debts like weeds. Why is that? Very possibly because he doesn’t bring himself to ask for the payment and people just overpower him.

If you give a client credit, only do it after they have proven their integrity to you by paying cash on delivery (COD) for some period of time. Also, you should find whether they have the cash to pay you - if not do not do business with them. Don’t trick yourself into the line of “I need the work” or “I need the sales”. It’s fruitless in doing the work or providing the goods for nada if you are not getting paid.

If you are the type of person who can’t demand the cash even when the work has been completed, try these ideas:
Tell your client that when the job is finished, you need cash or cheque. They should probably have it to hand over at the transacation and you won’t need to request your fee.

When you send out a quote, be sure your payment terms are understandable.

Form an invoice that has your terms of payment evidently printed and send the client the invoice when the job is done. They will see the invoice and simply realise they need to pay you for it now without you going to say a word. Fabricate a “vicious boss” who will burn you alive if you can not leave with the fee for the service.

Ask your banking to provide you with Merchant facilities so you can accept credit cards for example Mastercard and Visa. The large majority of people possess credit cards and it should cease the problem of the customer not owning a cheque book or not having the right amount of cash at the time.

Moreover, don’t be afraid to hold the promised goods till the payment has been made. Remember, until they have been paid for, they remain yours.

If you plan to permit a client credit, make sure you have the following contact details about them some time PREVIOUSLY you permit them credit.

• Name
• Address
• Phone number
• Bank name and address
• Account no.
• 3 trade references with their names, addresses and phone numbers

Once you possess all this detail, telephone the banking institution and make certain that they do have an account with them. Then, contact each trade reference and inquire if they pay their debts on time or if they have had any dilemmas with them.

Most people will be willing to tell you if the person is troublesome. If everything is OK, allow them a moderate level of debt, say no more than $500 (depending on your business). Monitor the operation of the account for a few months before allowing this amount to be exceeded.

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