Efficient Payments December 17, 2008Posted by Jeremy in Business, Business Solutions, Efficiency Process, Efficient Technologies, Green Business, Payment.
Tags: Billing, Business, Business Efficiency, Efficiency, Payment
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Getting Paid Quickly. This is something that every company dreams of. Like it or not getting paid for services is one of the most important things that companies have to deal with. Even though it’s important, it is very difficult to most businesses.
An article that I recently ran across called “5 Ways to Get Paid Faster” discusses some excellent ways to get paid faster and more consistently. He brings up a couple of points that I want to key on.
First, he says “Forget regular mail”. I think that this is an excellent point for two reasons. He outlines the a reason of loss of control. I am not quite a sure about that because you can’t completely verify that an email is delivered any more than you can a letter. I would outline a few of reasons of my own.
- Speed. Email is delivered virtually instantaneously. It’s a lot easier to verify that the email was received later in the day than to remember to verify that a letter was received a few days later. Also, makes due on receipt mean more when they get it the same day the invoice is generated.
- Convenience. You don’t have to run the letter to the mail box. How often do you forget to grab the outgoing mail and just do it tomorrow? This allows for delays in sending the invoices. If they are electronically generated and sent it will be easier to do more often.
- Green. It’s much more energy and resource efficient (thus green). There is no paper used, no need for transportation, no need for gasoline, etc. By utilizing, electronic means you have decreased the need for use of resources. It is simple but if enough people use this method, it can make a difference.
The second point to highlight is “Have a system to follow up”. This is an excellent point. As I described in the email point, how easy is it to forget to verify payments when you are busy with everything else. Your day gets hectic and you forget to run the report of outstanding payments. Before long, it’s been 30, 60, or 90 days. On the other side, how easy would it be to forget sending the check. You can probably multiply the ease by at least 5 compared to your ease of forgetting. Also, most people don’t like to follow up so they don’t. If you put the three problems together you can see the benefits to automation.
- Convenience. You don’t have to remember, it happens automatically.
- Consistent. Because it happens on schedule the reminders always go out on time. This will also act as a prod to your customers. They may have forgotten but when the reminder comes in they will have to remember.
- You don’t have to do it. The system does the dirty work. It is set on specific rules. The reminder will go out. You don’t want to follow up, it will.
I would extend on his idea. You should really consider utilizing automated systems to send invoices and follow ups. This allows all of your payment systems to be consistent. This will reap benefits. Many of the times, consistency in billing will lead to consistency in payments. If the systems are automated, it will not require that you intervene. So if you are busy, the roads are bad, you’re on vacation, etc the invoices and reminders will still go out.
I would add one other bullet point to his list. Allow electronic payment. This allows your customers to deal with the payment conveniently. Here are some ideas:
- Allow payment via your website (credit card and check)
- Setup recurring payment options for recurring billing arrangements
- Accept credit cards or ACH via telephone
- Consider utilizing E-Check options to speed check processing
You provide a service to the customer. You want to be paid for your services. Your employees want to be paid. If you can make your billing fast and consistent and the payment very convienent you will see faster and more consistent payments.