Our Top Tips For Reducing Your Late Payments

According to a report by Bibby Financial Services 51% of firms now wait more than 30 days for invoice payment, up 9% from the previous quarter in 2015. This report follows Small Business Minister, Anna Soubry's, announcement last month that a new Small Business Commission will be created to name and shame late payers (Source: Mail on Sunday, 16th August 2015).
We all know the old maxim that businesses don't collapse because of lack of profitability but they do through a lack of cash balance to operate. So managing your cash flow and resources to meet your needs, such as wage payments, supplier's bills and indeed for owner businesses drawing your own income, is not only vital but business critical.
Cash flow is a topic we frequently discuss with our clients, where we offer sound advice and tips to maximise your cash flow and reducing late payments.
Here are our 5 top tips to reducing your late payments and ensuring good cash flow:
1. State on your invoice your terms of payment such as payment due within 7 days and that late payment will accrue interest and admin charges.
2. Remember to invoice the job immediately after it is completed – many people do not organise their paperwork in good time.
3. For large projects, set up a standing order with the client straight away so that they can pay more manageable sums throughout the year.
4. Use finance companies such as "Go Cardless" to chase outstanding payments for you.
5. If large amounts are outstanding, enlist the service of an independent debt collector.
Talk to us