Late payments from customers can cause serious cash flow problems. Follow these four tactics to make sure you Get Paid on Time.
Late payments from customers can cause serious cash flow problems at your business. If you you need customer cash for regular expenses like rent and payroll, late payments can lead to late payment fees, interest costs on borrowed money and anxiety among your staff. It also increases the risk of nonpayment if the delay becomes extended.
If you want your customer to pay on time, you have to do more than just ask nicely. These tactics have been proven to work:
Establish a late payment penalty where interest begins accruing on the day after the money is due. Make this part of your contracts and list it on your invoices.
Offer discounts for companies that pay their invoices early.
Charge upfront payments. Charging 10 to 20 percent before work commences gives you a cushion against future late payments.
Negotiate when all else fails. If it’s apparent the client can’t pay the full amount, it’s better to get as much as you can on friendly terms, because lawsuits are always expensive.
Who is Mike Periu?
Mike Periu is the President of Proximo, LLC, a company that markets education and training programs to small business owners, entrepreneurs and consumers.
Mike Periu has been interviewed over 500 times for broadcasters including CNN, NBC TVE, RTE and others. Mike is a contributing author to OpenForum, Yahoo! Finanzas and the Huffington Post.
Mike graduated from Georgetown University in Washington, DC. His degrees are in Finance and International Business. In addition to his work Mike is also on the Board of the Council for Economic Education.
