So many experienced, as well as newly Self-Employed, Freelancers, Small Business Owners, and Professional Service Firms, struggle with unpaid invoices from clients; you're absolutely not alone.
My goal is to continue to address the problems for these groups, as well as educate you on what you can do yourself, to help you minimize your losses.
In order to maximize your cash flow, you must first understand and accept the following;
1.) You are responsible for seeking out, setting up, and adhering to the best possible in house practices with regards to ensuring payment for your business. It's your first line of defense against inadvertently giving away time or resources that you provided with expectations of payment. Whether every dollar is detrimental to your bottom line, or you're making money hand over fist, you should always be pushing to ensure that you don't leave hard earned profits uncollected.
2.) It is imperative that you perform as agreed and only seek out work for which you are qualified to live up to your end of the bargain on, per whatever terms are understood. If you can't reasonably do that with each client, and prove that you did, it's irrational to expect payment for such products or services.
3.) Regardless of how perfect you set up these processes, qualify your clients, and deliver these products or services, slow (and no) payers will be a fact of life for most of you. The statistics are out there, and I quote them often. I am also privy to first hand data, based on those we work for and against, on a daily basis. As I said before, you are by no means alone in not getting paid perfectly.
4.) This is an important one, and the one I believe is the biggest factor in causing losses for the groups I am primarily addressing. You MUST know your wisest, and most cost effective, options for dealing with these non-payment situations. If you've accepted, and stuck to, 1-3 (above) then most of this is already in place.
5.) The final ammunition to combat potential profit loss is to stick to your well thought out plan. Take proactive steps to minimize the threat of such loss-in a timely fashion. Once you understand WHY it makes sense to your bottom line, and you've stuck to and accomplished all of the above, it's easy to proceed with confidence and reap the rewards of maximizing your profits!
In doing all of these things, and making them a priority at the appropriate times, you WILL minimize your stress levels, you'll stop wasting time that you could spend attracting and nurturing new business, and ensure that you are depositing every last possible cent that you are entitled to-with no adverse effects.
There is a general lack of specialized "in the know" information out there for you to tap into on this subject. There is also quite a bit of misinformation out there that seems to have many of our new clients unaware of their best options, until we begin working with them. Don't give up on payment! We recover balances from 31 days past due, to over a year old, for all kinds of clients who otherwise would have written off significant losses unnecessarily.
Thank you very much for your time, and may your cash -FLOW- in the proper direction in 2013!
Contact the Author:
President & Principal Consultant
Cambridge Receivable Solutions, LLC
Toll Free: 1-888-908-3905 Ext.101
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