Talk to any credit control expert and they’ll tell you the sooner you follow up an overdue invoice the better. You’ll not only get paid sooner, but you’ll also send a clear signal to your customer that you take your payment terms seriously.

2015_JULY_ALL_MONEY - How to reduce your risk of bad debtors, starting today

So why do many of us wait so long to enforce our payment terms? Exposing our businesses to unnecessary risk. And remember all if your customer is paying you late in the first place, isn’t that a sign of more trouble to come? Or perhaps you need to revisit your payment terms – maybe they’re just not working for your customers? (participate in this survey to find out more)

Think about a common scenario that plays out in many businesses today:

Day 0 – Raise & send invoice with 14 day payment terms

Day 14 – Invoice is due

Day 21 – Send a reminder

Day 28 – Send another reminder

Day 35 – Make a phone call

Day 42 – Make another phone call

… you get the idea.

The point is that a lot businesses are waiting an extraordinary amount time to get paid and somehow it’s become “normal” or “acceptable”. Or maybe we’re all just too busy to stay on top of it?

It doesn’t have to be this way.

Why not (starting today) put a process in place to ensure your overdue invoice reminders are sent out the day after an invoice due date is missed – reducing your risk and increasing your working capital.

What would need to happen in your business to make this a reality?

  • Reconcile your bank account daily
  • Someone in your office to send the reminders*

*Or if you’re using Xero or Quickbooks Online you could use Debtor Daddy to automatically send the reminders for you.

Winning in small business is about systemising and automating good behaviours. Following up debtors rapidly is good behaviour. Being too scared (or busy) to have that awkward conversation with your customers is not good behaviour.

Matt McFedries Debtor Daddy

Debtor Daddy works with your existing online accounting software proactively reducing your debtors and increasing cash flow.