10 Things that will Immediately Improve your Cashflow

10 things you can do now to immediately improve the cashflow of your business

There are a number of things that you can do quickly and easily to improve your cashflow & reduce your debt collection costs to zero. We wanted to give you 10 things you could do now that would have an immediate effect on your business.


1          Use a Credit Control Service

Credit Control ServiceIt could be costing you more than you think to have debts. As well as the hassle of not having the money and not being able to spend it on improving your business, you are probably incurring a large number of other costs getting those debts paid. These include:

  • Overdraft fees
  • Bank Charges
  • Your time – time that would be better spent earning
  • Staff time – time that would be better spent earning

Collecting debts can be a massive drain on a company’s resources. The simplest way of fixing this situation is to use employ credit control services.

What you can do:

Look at our credit control calculator to see how much your client debts are costing your business:

Credit Control Calculator

What we can do:

We can offer a credit control service that manages your clients and ensures that thy keep on top of their payments without damaging your relationship with them. Our clients find that, because we are chasing money for them, their client relationships improve as they no longer have to talk about money. If you would like us to help, call us on 0800 4334113 or Contact Us.



2          Add a Debt Collection Clause to your Contract

Debt Collection Clause

Although you have to get your debts collected, there is no reason why you should have to pay for the privilege of getting your own money back. If your terms & conditions of business with your client include a clause that make the client liable for debt collection costs, you can reclaim these costs from your client when you reclaim the debt. This simple change can save you a lot of money.

What you can do:

Amend your terms & conditions so that you no longer have to pay for debt collection

What we can do:

We help you amend terms & conditions in relation to your debt collection costs. Call us on 0800 433 4113 or Contact Us & we will help you to reword your terms & conditions.



3          Run a Credit Check on your Prospects

Credit CheckThere is nothing worse than working for a customer that goes bust or cannot afford to pay. In our experience, however, a large number of these bad debts can be avoided by running a credit check on a customer before they become a liability. A business credit check takes a few minutes and costs a few pounds but it can save so much time, heartache and money that it is truly worthwhile.

What you can do:

Undertake credit checks on all new customers.

What we can do:

We offer a credit checking service that will give you comprehensive information on the ability that your client has to pay as well as any bad credit history or CCJs that they or their company might have. Call us on 0800 433 4113 or Contact Us.

4          Provide a discount for early payment

IncentiveIt is very common for companies to think about applying fines for late payments but it is not so common for them to apply incentives for early payments. It may be possible to improve your cashflow by offering your clients a discount if they pay within say 14 days. This discount could either be worked into your prices or it could be based upon the time & hassle you would save in collecting a late payment.

What you can do:

Offer a discount to customers (or just problem customers) for early payment. You may consider offering them an incentive to get them to sign up for a standing order – the person in their accounts department might be glad of a couple of cinema tickets and it’ll save them having to write  cheque every month.

What we can do:

We can give you some ideas of what our customers are doing to give customers an incentive to pay early. Furthermore, we can show you how much of a difference our credit control services can make to your cashflow. Call us on 0800 433 4113 or Contact Us.


5          Provide multiple ways to be paid

Payment Methods

By providing different ways for customers to pay an invoice, it makes life easier. The hassle of writing and posting a cheque can be removed if customers can pay online. If you would prefer a cheque make sure you state on each invoice who the cheque needs to be made out to. Payment by BACS provides instant cash, so it’s important to add your bank account details sorting code and bank account number on every invoice. Other credit card processing services such as PayPal or Google CheckOut into provide a low-cost way to a help business customers pay you. When dealing with a new prospect, a simple solution is to set up a direct debit or standing order process which relieves administrative hassle from their perspective, while guaranteeing your business a steady flow of cash.

What you can do:

Add banking details to the bottom of your invoice and setup a process to get customers to pay directly (perhaps get them to include their bank details and sign a standing order form as part of the intake process that makes them a new customer).

What we can do:

We can tell you how our clients provide multiple ways to get paid. We can also tell you how we do it. Our clients can pay us online and we can provide the details of how you can get this done on your website too. Call us on 0800 433 4113 or Contact Us.



6          Clearly communicate your terms of business

Terms of Business

When you deal with clients, it is essential that your terms of business are highlighted at an early stage. These include adding your payment terms to your standard terms and conditions of trade, application forms, and order notes, statements of account, order acknowledgements, dispatch notes, contractual documents, invoices and emails. By communicating your expectations, your customers will not be surprised when you send an invoice with a payment deadline. Try and get your invoices paid faster than the time it takes to pay your own suppliers. You will know what the average time it takes your customers from their own invoices. By providing your contractual terms, your liabilities are protected in case of any potential legal dispute in the future. If you provide materials or goods to a customer and they consequently go into receivership before they settle your invoice, you may have some recourse if you had effectively sold those goods on the correct legal basis in the first place. In other situations, it may be impossible to retrieve and goods or payment if a formal corporate insolvency process has been initiated, and / or depending upon your status and in the queue of secured or preferential status

What you can do:

Check your terms and conditions of business. Check you have terms & conditions of business. Ensure that your customers know what to expect, this will make it easy to manage their expectations.

What we can do:

We can offer advice on your terms and conditions with regard to collection charges. Although we cannot give you advice from a legal standpoint, we can help you with your terms and conditions and show how this will affect you when it comes to chasing payments or collecting debts. Call us on 0800 433 4113 or Contact Us.



7          Get to know the excuses and deal with them

Excuses Excuses

“The cheque’s in the post”

Many of us have heard this phrase and it can often be disarming. It is easy to leave the chasing of a payment when someone says they’ve paid, even though the cheque never arrives. There are a number of things you can ask, however, that will help you depending upon the situation of your client. Here are a few scenarios:

“I’ve already paid.”

In this case, you should say:

“In order to credit your account properly, I need to ask you when and where you sent the cheque and the amount it was for.”

  • If the cheque was sent more than ten days ago, ask for a new cheque.
  • If the cheque is not received in a reasonable time frame, then it’s time to submit the account for collection.

You can also say:

“Check with your bank to see if your cheque has cleared your account.”

  • If the cheque has cleared their account, ask for a fax of the front and back of the cheque.
  • If the cheque has not cleared their account, ask for a new cheque.


“I can’t pay.”

You can say:

“What’s the problem?” “Do you see a turnaround in your situation?”

  • If this is a long-term problem, the solution would be to suspend credit.
  • If this is a short-term problem and the customer is a good payer, offer a payment of half now and the balance by a specific date. Be sure to verify the cheque is received when specified and for the amount specified. If the customer breaks their promise to pay, then it’s time to submit the account for collection.
  • If this is a short-term problem and the customer is a bad payer, then it’s time to suspend credit and submit the account for collection.


“I won’t pay.”

You can say:

“What is the dispute?”

“Could we clear up the undisputed portion of this bill?”

  • If the customer is unwilling to clear up the undisputed portion or is unwilling to negotiate, submit the account for collection.


“I promise to pay.”

You can say:

“Since this bill is already past-due, please give me a specific date on which we will receive your cheque.”

  • If the customer is willing to give you specific information on the payment, confirm this information with them and thank them for their promise to pay.
  • If the customer is not willing to give you specific information, ask them who can. If you are talking to the right person and are told they don’t know when they can pay, suspend their credit and submit the account for collection.

What you can do:

Ensure that you and your staff are consistently chasing people. Print off the different scenarios above and refer to them during credit control conversations. Alternatively, you can call us and we can tell you about how we can offer a credit control service for a fraction of your staffing costs.

What we can do:

We offer a credit control service that ensures that your clients pay on time and that your relationship with them is maintained. Good credit control means fewer issues and better cashflow and it frees up you and your staff in order to do what you are best at. Call us on 0800 433 4113 or Contact Us.


8          Send comprehensive invoices out on time


Because of time pressures and poor administrative controls, some businesses do not send out invoices when they could have done so at an earlier date. This represents credit control suicide as it is a simple process, completely under the control of the business owner and is a simple matter of producing an invoice and sending it to the customer. Make sure your invoices have the minimum details:

  • Trading Address
  • Company Number
  • Registered Address
  • VAT number (if appropriate)
  • Telephone number and Fax Number
  • Contact Name
  • Preferred method of payment
  • Invoice Amounts and currency
  • Payment terms including discounts
  • Deadline for payment, including implication of non-payment
  • Trading Terms and Conditions
  • Detailed description of goods or services provided including references to customers purchase order, customer number or other internal reference
  • Website and email are also helpful

What you can do:

Ensure your invoices have the details above and that they are sent out on time.

What we can do:

We can help you in relation to setting up an invoice process. Furthermore, we can offer a credit control service that ensures your customers pay on time. Call us on 0800 433 4113 or Contact Us.


9          Ask customers for trade references

Trade References

When dealing with a prospective customer seeking trade credit, a commonplace action is to ask for the names and telephone numbers of some of their other existing suppliers. If offering credit terms asking real people about them is essential. Referees have already dealt with your perspective customer end hence will be up to provide a first-hand account of how they do business, how quickly they settle their outstanding debts and whether they are to be relied upon. Ask questions like how long have they known them, what sales per month and do they keep their promises.

What you can do:

Ask your customers for references. These will show customers that you are good at what you do and it will make them aware that you are putting your money and the viability of your company on the line when you extend an offer of credit to them.

What we can do:

We offer a credit checking service that will give you comprehensive information on the ability that your client has to pay as well as any bad credit history or CCJs that they or their company might have. Call us on 0800 433 4113 or Contact Us.


10        Get debts to us quickly

Time is of the essenceDespite your best efforts, things can go wrong and customers can miss payments. These debts can be chased and you do not need to worry. On these occasions it is essential that you take action as quickly as possible, however. The first sign that a company is in trouble is that they stop paying. If this can be caught early and  they can be made to make a payment or a partial payment, you need not lose out. If the debt is left, however, the company could go bust before you can get the money from them.

The longer a debt has been outstanding, the harder it is to collect as it becomes increasingly likely that the company you are trying to collect it from is no longer around.

If you have any aged debts that are more than 90 days overdue, pass them to us immediately for further action as the cost of inaction is a loss of money.

What you can do:

Take a look at your Aged Debt reports and look at the clients that are 90 days overdue. How much money do these clients owe? There is a risk that you will not see this money unless you act. Chase the debts that are 30 – 90 days overdue and teach your clients that you will not allow them to take advantage of your company’s resources.

What we can do:

We can collect debts of all kinds and we can give you some advice as to when to notify us that a debt needs collecting. Furthermore, we can have an informal chat with you in order to take a look at your Aged Debtors and to see how cost-effective a credit control service would be for your company. Call us on 0800 433 4113 or Contact Us.

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