As business owners it’s good to look forward and plan for the future as far as you can. Always have one eye on the horizon. If Covid-19 has taught us anything it is to expect the unexpected.
Even in early 2020 very few of us expected to be locked down and have our businesses turned completely upside down and most of us had never heard of Furloughing! So it is essential to have to have one eye on the horizon and have a what if strategy.
The Pandemic saw some businesses struggle and others see unprecedented levels of business which created its own problems from sourcing stock and services through to the logistics of distribution and methods of payment.
All businesses will do continuity planning within their insurance needs, what would you do if your office flooded or burnt down, what would happen if your internet went down so why don’t we do more continuity planning for our actual business?
What would happen if your main client went under? Could your business survive? If the answer is yes, well that is great but what would happen if the answer is no? Is it time to look for other income streams and take some of your eggs out of the same basket!
Having a what if strategy can see your business prepared for the curved balls life throws at us from time to time. Any business coach will say cash is king and any interruption is the flow of income into your business can have a disastrous affect both short and long term
Therefore, good credit management is so important, rather than being re-active be pro-active. There are amazingly simple measures you can put in place which will improve your cash flow and improve relationships with your client.
When you have sent an invoice to a client follow up with a call, confirm they have the invoice plus more importantly check that all the details are correct. Give them every opportunity to confirm your invoice will be paid within your terms and conditions and if there is an issue you know you can rectify it quickly.
The other fact that many people forget is to allow time, book time out of your diary to carry out credit management which will mean is you are not being distracted by other work issues. Furthermore, regular contact with your clients ensures good communications and shows that you operate professionally and efficiently.
Alternatively, you can outsource! We offer a service where our professional team will contact your clients as you issue invoices to ensure they will be paid promptly and within the time limits your terms and conditions stipulate. In this instance we are not acting as debt collectors but as your credit management department.
As we have talked previously about outsourcing, I think you will realise by now that we believe it is a good way of expanding your team and presenting a much larger and efficient team to your clients.
To summarise, have one eye on the horizon for those unexpected diversions in the road that come along whether they are positive or negative.