When you first went into business providing IT services, you may have thought the battle was over as soon as a client signed an agreement, or you finished the project.
The hard truth is that until the money is in your account and available to help you grow your business, it means nothing. Because A/R does not pay bills… cash does.
The painful fact is that 80% of ConnectBooster’s customers come to us with at least 30-45 days outstanding on unpaid invoices!
Hey… can I borrow $50,000?
If you have a monthly rolling A/R balance of $4,000, you know you are probably going to get paid for it eventually. You might not even consider it to be a big deal that your client is taking 30-45 days to pay.
But the fact is that if it continues throughout the year, you are actually giving out micro-loans to your clients to the tune of $50,000.
We think that is simply unacceptable. And you should too… that is if you are in business to actually make money and grow.
On the other hand, if you are providing IT services simply out of the goodness of your heart, then by all means, continue with what you are doing.
I do not want to be a loan service… but what can I do?
The first step is to demand that your clients respect you and the valuable service you provide, and then pay accordingly.
After all, if you were a utility company and your customer still had not paid at 60 days, you’d probably shut their lights off and not think twice about it.
So why aren’t you asking for the same respect from your customers? After all, you do provide a vital service – a service that would cause your clients to suffer if they were to suddenly lose it.
But how do I get respect?
Simple… You ask for it. Begin by setting your expectations for payment up front. Have your sales team explain payment terms clearly during their conversations with new clients.
The next step is to make it easier for your customers to pay by making it an automatic process. That way your customers will no longer have the option to delay payment on your invoices.
Automatic payment makes it convenient for ongoing customers to “set it and forget it” when it comes to paying your monthly bill.
It also takes away the opportunity for your clients to evaluate whether or not they will pay your invoice each month. And, it helps you avoid the all too common, “I didn’t get your invoice” excuse.
But that is a whole other story. One that you can read more about here.
For this article, I will close by reminding you of why you went into business in the first place – to provide a valuable service that your customers depend upon – and that you deserve to be paid for… on time, every time.
Go from loan service to IT shop in 6 easy steps
To learn more about how ConnectBooster can help you get paid on time and stop acting like a loan service for your customers, click here to sign up for our 6-part email series.