|Small Business Information|
Solving the Late Paying Customer Blues
Nothing can drive a business down faster than customers who don't pay their bills as agreed. When you sell to customers on credit you are making an agreement with them. You will provide them with goods or services in exchange for their payment within the terms you agree upon. Period.
What I'm seeing more and more of is businesses using their suppliers as banks. Taking 60-90 days or more to pay a bill is becoming more and more common. I've seen some business owners shrug their shoulders and just accept that nothing can be done about it. That's just the way it is.
Naturally, I disagree with that approach. The reason you grant credit is to increase sales. But, the sales you want more of are the sales that pay and don't drag your business kicking and screaming into the Cash Flow Swamp.
So, what's a business owner to do?
Late paying customers can create a serious threat to the survival of your business. Whether you're just starting out or you've been in business for awhile, it's a critical business function to develop a solid plan to get paid.
Here's an example of a solid plan:
You decide your business will not grant credit. You decide to be paid up front before you provide services or products. You get set up to accept credit cards or use Paypal (or both). You communicate in no uncertain terms (nicely but firmly) what your payment terms are. You explain that payment is due before (or at) the time of service or purchase and that you accept cash, checks, money orders, credit cards and Paypal. Period.
Then, you stick to it with no exceptions. You make that a condition of doing business. Communicate it firmly and respectfully. Don't waffle or apologize. People who take advantage of others can sense weakness. So can people who always have a tale of hard luck and woe. It's human nature.
Remember, late paying or nonpaying customers are endangering the survival of your business. These are not the customers you want to do business with. You'll have nothing to show for your work but stress and poverty. If you want to do some of your work for people in tough situations, donate your time but do it with the understanding that the majority of your time has to be spent on work that pays.
If you're working on a big project, set the expectations before you start so that a condition of doing the project is incremental payments. A percent before you begin, a percent during the project at specified intervals, and the remainder due on completion. This gives you the option of stopping work if you're not getting paid.
As with all areas of business, the best Defense is a good Offense. Set the standard for how you'll be paid, communicate it, and stick to it.
Caroline Jordan, MBA helps small business owners understand, diagnose, and improve cash flow in their businesses. For more information and free resources to improve cash flow visit http://www.TheJordanResult.com/mastering.html.
Financial Fundamentals - What Every Small Business Owner Should Know!
Business owners rarely go into business to deal with the financial aspects of running a business. It's easy to understand why! You are passionate about the products or services you provide and want to focus your time there. The financial aspect usually falls to the bottom of the "desired responsibilities" list. It is critical to the long-term success of your business that you understand some of the Financial Fundamentals of being a business owner though. You don't have to be an accountant or financial analyst, but it is important that you have some key skills in your business toolkit to measure the financial aspects of your business. It's okay to outsource this activity so that someone else can do the work you don't like to do, but make sure you understand the output of the financial information. You'll need it to help you make informed decisions about your business. Remember! Accounting is not just about taxes. There's so much more to know about the numbers, so you'll know how your business is doing from the management perspective.
Debit and ATM Card Advice for Small Businesses
Your business account comes with an ATM, Debit card. Pick a really secret pin number. Don't give it to anyone even in an emergency. Make sure you record withdrawals. If you have a bookkeeper paying your bills for you, be careful because they won't know that you took out money. They will be upset and so will you and your vendors if they mistakenly write a bad check to pay a bill because you forgot to tell them of your numerous unrecorded withdrawals from the ATM machine.
Serious About Writing A Business Plan... Start A Business Plan Library
Tap these treasures of ideas. The best money you can spend is money invested in your business plan education. Don't shortchange yourself when it comes to investing in your dream. Start gathering samples of business plans and collect business plan books and get a business plan library started, it can change your future. Here's what your library needs to show: that you're a serious student of business strategy and planning, finance and economics, selling, and writing.
Challenging the Gospel of Growth -- Must Business Grow to Survive?
A cherished business doctrine is that growth must be a primary business purpose: "grow or perish" is a mostly unquestioned truth. At South Mountain we favor certain kinds of growth, but not expansion for its own sake, which author Edward Abbey described as "the ideology of the cancer cell." We embrace growth to achieve specific goals, but always with consideration of the consequences: it may disrupt and endanger treasured qualities. We look for ways to develop and thrive without enlarging, thereby holding to limited growth. When we grow, it is by intention rather than in response to demand. We think about "enough" rather than "more"-enough profits to retain and share, enough compensation for all, enough health and well-being, enough time to give our work the attention it deserves, enough communication, enough to manage, enough headaches.
Postcard Marketing ? Low Cost Visibility
You need to be visible to attract customers, right? But how do you get that visibility when you're short on cash? Here's an idea that's worked for many businesses. It's postcard marketing, and it's very affordable.
The Franchisors Heavy Load
Why are we over regulation the franchising industry, what purpose does it serve? Rules and laws are fine, level playing fields are nice, but the customer votes with their dollar and the entrepreneur and companies can only sell what people are willing to give up that unit of trade we call a dollar for.
Tell Me a Story: A Simple But Powerful Tool to Build Your Business
Everyone loves a good story. Whether it's the story of your vacation to an exotic place, the story of how you met your spouse, or the story of your small business, people get drawn in and feel involved. Storytelling is as old as civilization itself.
Too Many Lawyers in Franchising Today
Attorneys and Lawyers are ruining the franchise industry. It is too bad too, because franchising represents over 400,000 businesses in our country and accounts for just over one-third of every consumer dollar spent in this country. By over regulating and over lawyering the industry we are weakening our free markets and suffocating our up and coming entrepreneurs.
Most Franchises Are Small Home Businesses
Many of our nations 400,000 franchisees run their businesses out of their homes and therefore their home addresses and phone numbers are listed in the Unifrom Franchsie Offering Circular's, attachments. Uniform Franchise Circulars, UFOC, are for franchise buyers and they explain the investment involved. It is required by law that they be given out to potential buyers in advance of any sale by 10 business days. How can a franchisor be assured that someone sending an email or filling out a form is a real entity? Most franchise sales people see email addresses all the time that do not match the names they are purporting on the forms. They are suspect.
Small Business Success Tip: Learn Something New Everyday
Your grandfather probably told you to "learn something new everyday". Your grandfather was giving you advice that works for your small business as well as your own education.
Creating a Paperless Office
When working from home, it is usual to find that you have your office in an area that is not very big, such as a box room or even in the corner of the kitchen. When your business really takes off, you will begin to discover that your work area starts to get swamped by paperwork and that you are running out of storage space.
Are You Really the Boss in Your Own Business?
I recently met with a very successful magazine publisher who was telling me how a chain of retailers for his magazines wanted everything their own way, even at the expense of losing revenue for their stores and missing out on the opportunity to provide real customer service to the customer.
Business Success - The 42 Greatest Business Tips
What does it take to grow a business and run it successfully? The main ingredient is attention to the basics, operating with integrity and following the way other successful people have run their operations.
Successful Small Businesses Use PR
It's obvious when a small business has accepted the fact that its most important outside audiences need lots of care and feeding. They do something about it.
Earn More Money in Your Small Business by Creating a PIG
If you really want to earn more money with your small business than you need to strongly consider adding a P.I.G. Obviously, I am not referring to the questionably adorable pot bellied pig that many fine people have adopted for a pet. The concept of adding a Passive Income Generator to your business should be a top priority if you want long term income.
A Lesson From ?The Apprentice? That Can Make You A Master
I have to admit, I was curious. When I saw previews of a new show called "The Apprentice," it made me want to at least watch the premiere to see what was going on. Immediately, I was hooked. The whole idea of candidates - from all walks of life, not just college grads fresh from their commencement ceremonies - vying for a position in one of Donald Trump's organizations piqued my interest. What kept my interest were the real-life advertising lessons every business owner needs to be reminded of.
Arranging Your Fundraiser
When deciding to host a fundraiser for your company or organization there are many fundraising ideas available to you for choosing. The most popular fundraising ideas range from chocolate, magazines and candles to candy and much more!
The PR Commitment to Small Business
We're birds of a feather, public relations and small business. Wonderfully compatible and a perfect fit. Usually makes it easy to commit resources to small business success.
Small Business Computer Security, the Basics
Anyone in business today realizes both the natural dependency on computers in the workplace, and also the potential dangers associated with storing important data on them. Today's business owners are constantly being reminded that their company's data is at risk by the daily reports on various news stations, or even their favorite business-related website.
Why Do Franchisors have Exclusive Territories
The reason we Franchisors call it an exclusive territory is because we will not sell that area again to another franchisee. That is your area to market and to conquer and to generally obtain as much market penetration as possible. If you are a home-based business or mobile franchise then this is a serious issue. You can put as many service units in your area can support and try to make the most reasonable profit you can per each service unit you put into your exclusive territory. Most franchisors charge a percentage of the gross income and probably make a little off every service unit you buy, so they want you to expand.
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