Better Invoicing Means More Cash!

With all the ups and downs that happen, it is important that you take time to learn to manage your business finances. You must be able to have money set aside in the cash reserves that you can fall back on when it is necessary. You also need to have money ready to pay for the employees' salaries as well as having money ready for business expansion. Learning to become self-sufficient instead of needing to borrow money all the time can help you in creating a company that is profitable and one that people have an easy time supporting because you don't need to increase prices just to pay the loans you have taken out.

As many businesses have fallen due to the issues with the economy, it shows business owners more than ever why they need to take the time to learn to budget and to collect the money from their customers in a timely manner. There are quite a few companies out there that let people borrow money and they do not collect it for a long time. If you are not promptly collecting the money, you are really hurting your business. You have to get on top of the account receivables because this is your cash flow! People that borrow are tying up the money that you could be using for business expansion and other needs. You really need to be able to focus on getting this money in a timely manner so you can keep the company ahead.

Once a person orders, you need to generate an invoice and send it out. You want the invoice to be prompt in getting to their home as this is when the sale is fresh on their mind. The customer is likely to pay when the transaction is "fresh" and they do not need to be reminded of what it was that they are paying for here. Make sure you are quick to send out those invoices so people will pay.

Offer the customers multiple ways to pay. When they have credit card options along with PayPal and other services, it can help a lot of people to pay their invoice. You should consider getting the information out to the customers quickly so that they can pay and to give them options to make it much easier for them to make these payments. If you do not make it easy for them, people will not pay and they will really be hard to work with. You might end up moving them to collections as they are not willing to pay on their own.

Your invoice needs to be clear on the types of payment you will accept along with the options that the customers have. If they do not pay by a certain date, be clear that they will be charged interest. The more that you remind them to pay, the easier it will be for you to motivate people to pay. Don't wait on the invoicing and get it out to them quickly.

Have some employees that are devoted to the collection process. They need to be able to get on top of the people that are not paying on time. When you have a collection team, it allows you to set up payment plans and other things, making it easier to get the money that is owed to the company.

If you can get the money from the customers sooner, you have more money available to help you grow the business. Your cash reserves aren't waiting for people to replenish them and you can use them to expand the business along with being able to invest in equipment and other things for the company.