Getting paid on time can make all the difference to the health of your business. Our top tips will help you get what you’re owed.
It is incredibly important to protect Britain’s SMEs: the sector makes up 99 percent of all businesses, providing 60 percent of jobs and 50 percent of all private sector turnover. Unfortunately, because of their size, SMEs often have very little room for manoeuvre when it comes to cashflow: often they have to accept the payment terms of bigger businesses, and if an SME doesn’t have the cash to pay their bills to another SME, it can create a chain reaction that causes problems along the line.
David Beer, Chief Commercial officer at itsettled, says that while financing is one way for a business to remain solvent, there is no substitute for money that has already been earned and owed. Beer told Swoop:
“During the pandemic, 1.67 million businesses received £79.3billion of funding, but the late payment problem is still a massive issue. You cannot forever borrow your way out of it, and we risk sailing into a perfect storm in the marketplace that is stopping us from making a sustainable recovery.”
With itsettled there’s no more worrying about getting paid, keeping track of overdue invoices, or damaging relationships when asking for payment. Simply sync your accountancy software and the platform does the rest. Start your 30-day free trial (no credit card required) today.
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1 Take names
Knowing who is responsible for a payment can make all the difference when you’re chasing up. If you have a specific contact within a business, it adds social pressure to chase them rather than a generic ‘accounts department’.
TIP: Don’t just get names, make friends: social pressure will help get your invoice to the top of the pile.
You’re probably used to chasing invoices, but according to David Halpern, author of ‘Inside the Nudge Unit’, there are things you can do to encourage timely payment:
“The Behavioural Insights Team found that adding a simple (and true) statement on tax reminders that ‘most people pay their tax on time’ encouraged far more people to do so… Such changes were shown to bring forward hundreds of millions of pounds of revenue in a year and helped change the way that the Revenue Service operated.”
TIP: add ‘nudges’ to your communications before payment becomes overdue.
3 Beware ‘out of sequence’ payments
Ever had a customer pay invoices in a seemingly random order? If you’ve been waiting for money to come in you’re pleased to see anything arrive, but you need to keep tabs on what has and has not been paid for. This becomes more difficult when you are constantly doing business with a customer. David Beer from itsettled says:
“There are two types of slow payers: those who can’t pay and those who won’t pay. The itsettled can help you identify which is which early and take appropriate action.”
TIP: be aware of payments arriving out of sequence – it may be a tactic to avoid payment (or a sign of being disorganised). An occasional phone call to go through payments and check anything outstanding will help cut through confusion.
Businesses have found that automating tasks gives them more time to work on the things that truly add value to a company. Swoop has partnered with itsettled, a platform that automates invoice tracking and chasing. David Beer says:
“Apart from us, I can’t think of anyone who goes into business to chase invoices. We set out to build an easy-to-use platform for invoice management that pays for itself in terms of time saved and money recovered. Using our platform is one less thing to worry about.”
TIP: use itsettled to ensure that you are tracking and chasing payments automatically.
Prompt payment can be the difference between viability and failure for businesses. Letting automation do the heavy lifting of handling payment is an effective and efficient way to ensure that you are paid what you are owed, enabling you to meet your own financial obligations and get a reputation for being a great customer.
Use itsettled to get your invoices paid faster, reduce risk, and improve the cashflow performance of your business. Sync itsettled with your accountancy software of choice and the platform does the rest for you.
If you would like to try itsettled for yourself, click here to begin.