Do you wish to get better outcomes when it comes to payment collections from clients? Then here are some Wize insights for you.
First and most important step - you have to get your sales process right.
Debt collection is a reaction to a bad sales process. Get the sales process right and there should not be a problem with debt collection. In other words, fix the problem and not the symptoms.
Namely, your sales process should be in 3 parts:
Identify clients problems and provide a solution
Send a Proposal of what was suggested with fee and payment terms which could include:
(i) payment upfront before starting.
(ii) Paid half upfront and rest on completion
(iii) Monthly by Direct Debit or
(iv) COD on completion.
Whichever they accept, they should sign a payment form such as Credit Card details or bank details with permission to deduct on agreed terms. If they are not prepared to sign on to any of the above terms, (despite the options provided) alarm bells or red flags should be going off and prevention (do not proceed to production) is better than cure (chasing for your money after incurring labor cost)
This should not begin until proposal (item 2) has been signed and agreed to.
Get any of the above out of order or miss one step and you will be in trouble (example: debt collection required)
Moving from Discovery (item 1) to Proposal (item 2) quickly will improve efficiency and wasted time.
Those who get more Proposals signed off than others execute the journey from Discovery to Proposal quickly and efficiently. Those who waste too much time in Discovery will be less productive (less Proposals signed off).
P.S. Whenever you’re ready… here are 4 ways we can help you grow your Accounting or Bookkeeping business:
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