So far in this “Getting Paid” Series we’ve learned to clearly define “Payment Expectations” (your terms) up front. (Stop being “timid”!) And then don’t put off starting the dreaded collection process. (Have I mentioned “stop being timid”?) So let’s tie this series up with my TOP TEN “Getting Paid” TIPS:
1. Try to get paid when you do the job. Use the “assumptive close” as in, “Our policy is to receive payment upon completion of our services. We do accept cash, checks, VISA, Mastercard or American Express…”
2. Invoice the client ASAP. Get the clock ticking on your payment terms. Or maybe just…
3. Offer a discount for early payment. A common discount is “2% 10 days/ net 30” which means if they pay you within 10 days they save 2%. (If you want to improve fast payment include the actual amount the client will save on the original invoice as in “Pay by April 12th and you save 19.65 ! So send us a check today for 969.75 instead of 982.40! (Check MUST be postmarked on or before 4/12/2015.)”
4. On larger jobs/losses ask if you can do “incremental billing”. For example, on a large institutional account ask, “Mr. Smith, when we have completed the western half of your student housing may we pick up a check for that part of our bill?” (See #1 above. As my mother always said, “It never hurts to ask!”) Or at the least…
5. Negotiate. If they try and put you off (and it is a larger amount) say, “Could I at least get half now?” And by the way…
6. Don’t fall for the old “I’ll put it in the mail” detour! If the client is within driving distance reply, “Great. How about I save you a stamp and just pick the check up today?” If you can’t stop by ask, “Could I put the payment on your credit card?” If you can’t get a credit card say, “OK, today is Tuesday. If I haven’t received your check by Friday I’ll call you again.” And then…
7. Stay on top of it. Put the call in your calendar and follow up! (The “squeaky wheel” really does get the grease!)
8. Review your problem accounts at least weekly. Download your free weekly SFS Financial Flash Report HERE.
9. Start them off right. On new accounts be polite but firm on payment. Communicate your “clearly defined expectations” right from the “git-go”.
10. Change your attitude! Instead of viewing it as “begging” remember they have “YOUR MONEY”! So just like with sales calls never end your conversation without defining the next step as in, “So then we have an agreement? I can expect to see your check for 286.40 in my mail box by Friday? (Wait for response) So Mr. Jones, if the check isn’t in my hands by Friday I’ll make one last courtesy call to you before calling our attorney which is the last thing I want to do so please…”
So what other collection tips do you use? Write your comments below! And remember, they have “YOUR MONEY”!
Steve