Shaking,The,Money,Tree,amp,#58 business, insurance Shaking The Money Tree: Managing Slow Payers

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*Article Use Guidelines*Use in opt-in publications, or on Web sites, but please includethe resource box. Please send me a copy, if possible. Many thanks.**Summary: Slow payers affect every business. Because they canseriously affect cash flow, it's vital that small businesses havea system in place to manage them.Total words: 750 Category: Small BusinessShaking The Money Tree: Managing Slow PayersCopyright (c) 2002 by Angela Booth When you're running your own small business, especially if you'rea solo operator, you need four pairs of hands, eyes in the backof your head, and psychic abilities don't hurt either.Most of your clients will be wonderful, but some will bedifficult. And unless you have a system in place to manage them,slow-paying clients fall into the difficult class. If you allowit, slow-paying clients can damage your cash flow. My system for managing slow-payers is simple. So far it's workedwell, but I'm thinking of revising it, and following up morequickly.=> Get it in writingIf you provide a service, you need a basic agreement that youautomatically give to all new clients. You can tailor this basicagreement as necessary.For example, when a new client hires me for a copywritingproject, I send him my Writing Services Agreement. Here it is ----<--------------Writing Services Agreement -------->Your signature below authorizes me to write copy for the projectabove, for the fee stated.Two revisions are included if requested within five days of yourreceipt of copy, and are not based on a change in the assignmentbrief made after the copy is submitted. Balance of payment is dueon receipt of the invoice.You understand that the assignment is work done for hire, whichgives you the copyright. You release me from any responsibilityfor legal or other problems that may arise from the use of anycopy I write for you.<------------------------------------------------->The agreement covers the details of the project, as well as theterms of payment.Most clients are good about the agreement, and readily sign it.But what happens if you have a rush job --- say a client needssome work done within the next few hours --- and there's no timefor formalities?Always insist on something in writing, whether you fax them yourown agreement, or they fax you a purchase order. Without thedetails of the project in writing, you'll forget what you said,or they'll forget what they said. It's worth taking the extratrouble to spell it all out in writing --- however briefly --- sothat everyone's on the same page.=> The check's in the mail Unfortunately, even with the agreement signed and sealed, someclients extend the payment period. I don't concern myself for 30days, which is probably a mistake.After 30 days, I follow up, usually with an e-mail reminder. Ifthere's no result, I follow up again each week, either with an e-mail message, or with a phone call.Sooner or later, the client will pay his bill. To gee up the laggards, in future I'll be following up after 14days.=> Tips to keep the cash flowing* Bill your client as soon as you've provided the service. I usedto allow five days to pass, but since I provide two revisions ofcopy if necessary anyway, I invoice as soon as I've completed thework. * If you anticipate heavy expenses, bill the client up front fora portion of them. Keep track, and present your expense sheet forpayment regularly.* For long projects, bill at stated intervals. Once a week isreasonable, once a fortnight is too long. Don't continue workwithout getting paid. Be inflexible about this. If you allow toomuch leeway, you can find yourself working for a month, andunable to collect because the client is insolvent.* Check your finance program to see whether it has a reminderfeature. If it does set it remind you to follow up on slow payersregularly.* Keep your cool. Be calm, polite and completely professionalwhen you follow up with slow payers. Slow-payers are a fact of business life. Put a system in placethat helps you to handle follow ups with them quickly, and theywon't bother you too much.***Resource box: if using, please include*** Angela Booth crafts words for your business. Words to sell,educate or persuade. Contact her today for a free quote: http://www.digital-e.biz/Free ezine: Creative Small Biz --- subscribe at:http://groups.yahoo.com/group/Creative_Small_Biz/ Article Tags: Managing Slow, Slow Payers