6 ways to stop customer holidays delaying payment
One of the most common late payment excuses we hear during the summer months is “my director is on holiday”.
But there’s no reason a few weeks in the sun should impact on your business being paid.
Here are 6 ways to stop customer holidays delaying payment.
Plan for holidays
Be sure to investigate whether your customers have a shut down period during the summer months. This is more common in certain industries and planning around this can ensure you don’t risk payment delays.
Likewise, raising invoices that are due to be paid on a bank holiday could cause delays so it is wise to make the necessary adjustments to the due date on your invoices so that you don’t get caught in the bank holiday payment trap.
Make sure you invoice as soon as you have delivered the product or service and that it is accurate. Here are 10 common invoicing mistakes to avoid. Any delays or mistakes you make will give your customer an excuse to stall payment. And make sure you follow the initial invoice up with a courtesy call to check their plans for payment. This is the perfect time for your customer to explain that they are going on holiday and you can make alternative arrangements for payment.
Find an alternative contact
If the person in charge of paying you will not be around to make a payment in time, find out who has been tasked with dealing with payments in their absence. Normally in these circumstances signed cheques will have been left to settle important accounts or payments scheduled. If your invoice has become due, get a commitment from the person on the phone that the invoice isn’t disupted and that a signature is the only reason for late payment. Most importantly, make sure you schedule a call back to chase up on it.
It’s important to be persistent to remain at the front of the queue for payment. Keep in regular contact via phone and email. Take a look at our timeline to getting paid for a handy guide to how you should keep up contact when chasing payment. Often a customer will pay the invoice for no other reason than to stop receiving your calls and reminders.
Outsource the debt
Sometimes no matter how persistent you are some customers will continue to put off making payment. That’s when outsourcing the debt may help. The added pressure of a third party could encourage the customer to pay up. Likewise, outsourcing debt recovery can assist when your own internal resources are stretched over the holiday season.
Get a cash flow boost
Seeking alternative cash flow solutions can help to even out periods when you don’t get paid on time. With factoring and invoice discounting, you can access up to 90% of your sales ledger value within 24 hours of an invoice being raised. This can help to bridge the cash flow gap between providing a service or supplying a product and being paid, which is often even longer during the summer months.
For more top tips to help you tackle late payment, visit our credit control tips section to check that your business is doing all it can at each stage of the order-to-collections process to get paid. Or contact a member of our team on 0800 977 4848 to see if they can help.