One of the comments I’m hearing from business owners these days is that payments are slow in coming.Â
While the last thing you might want to do is add more to your receivables, it might just be the thing that gets you an edge over your competition and gets more new customers in your door.Â
One option:Â Offer financing.Â
Obviously, you have to make sure the economics are right, particularly if you have cost of goods sold. If the economics work for you, offering a 3 payment, 90 days same as cash is a very effective way of making it easier to buy, no matter what business you’re in.
You might need to change the terms to fit your delivery schedule, the cost, and so on, but it’s worth examining. I’ve seen businesses mushroom in size simply by offering a small down and a monthly payment plan for services and non-tangible goods (software is a good example).Â
This probably doesn’t help you if you sell coffee by the cup.
On the other hand, if you do catering jobs and you take reservations for events that are weeks away, take a credit card number and offer to divide the cost by the number of weeks between now and the event. Ring the card up weekly.Â
Got an existing accounts receivable with a good client that’s due in one big piece? If it’s late, offer to let them split it into 2 or 3 payments, with payments coming every 2 weeks, 4 weeks or whatever makes sense.
Remember, you don’t have to offer this option to everyone. Perhaps only your best clients receive this benefit. As famous retailer Murray Raphael said, “Treat everyone the same (ie: really well), but reward them differently.”
Doing what makes sense to help your customers pay you (and they really do want to) beats not getting the business, not getting paid and perhaps most importantly, discounting your work and getting into a price battle.Â
Be creative. Make it easy to buy, now more than ever.