Anyone finding it hard to get invoices paid, what ya doing bout it?

FusionNet

I know the answer to this question already, YES!!! But what are people able to do about it?? And before people suggest solicitors letters Im more interested in alternative ways to get the cash in..

Some industries arwe cash based so have no excuse not to pay but industries like mine people expect credit? Is the Ireland we know gone where you'd call someone they'd come out fix something and you'd invoice later, are we going to get to a point where we'll be invoicing on site before we leave?? Could be interesting times ahead..

Discuss!!!!

Bandara

FusionNet wrote: »

I know the answer to this question already, YES!!! But what are people able to do about it?? And before people suggest solicitors letters Im more interested in alternative ways to get the cash in..

Some industries arwe cash based so have no excuse not to pay but industries like mine people expect credit? Is the Ireland we know gone where you'd call someone they'd come out fix something and you'd invoice later, are we going to get to a point where we'll be invoicing on site before we leave?? Could be interesting times ahead..

Discuss!!!!

Why do you not offer your customers a 5% discount off invoice for payments made within 14 days?

Yes the 5% is pain for you, but I'd suggest your spending that chasing money for 90 days anyways.

Its a great deal for the customer and its great for you.

Just a suggestion.

FusionNet

Ah ya its a good suggestion. Cetain things have higher margins anyways so fiver percent wouldnt be the end of the world. My concern though is older invoices. There the hard ones to get in as they are over the last 12 months.

Going forward (I know I hate that term too) we have change the credit terms so that we wont get caught, but its old debts that are the tough ones..

EI-EAY

You can get a debt collection agency to collect at 10% no collect no fee if its a larger debtor.

Obviously using them depends on how much you value your customers. Theres a fine line between sucessfully getting cash in and loosing customers from pushing for it.

Trojan

It is particularly difficult at the moment.

Depending on the project, we offer up to a 10% discount if the entire payment is made on commencement of the project.

Payment plans (i.e. X amount per month for the next Y months) is one way of doing it: you're helping out your customers who are in a tough position and you're at least making your own cash flow a bit less haphazard. You could put interest on it (I'd suggest a small, reasonable amount so you're not taking advantage).

I do know one business that ask twice for the payment and then sell the debt to a collection agency. I couldn't do that, but might work depending on your business and relationship with your customers.

VO

I am reasonably lucky in that most of my payments come in by Direct Debit but I still have a few dodgies. What works best is to have a policy which you adhere to.

Something like so

30 day credit -

phone call on day following 30 days

Second phone call 7 days later

third phone call /account on hold on 45th day

Solicitors letter on 60th day

the only way to make your customers realise that you are serious is by sticking rigidly to your policy. It is extremely difficult to do as you are trying to balance the sale against getting paid and that is not easy.

Having said that spoke to somebody who had a customer go into Liquidation a month ago owing him €250k. He allowed this to build up over a period of 5 months and was not receiving payments just promises and on the basis of promises he kept delaing with him. Bet he wishes that he had a rigid credit policy and stuck to it.

Remember a Sale is not a Sale until the money's in the bank.

Varkov

i wouldn't even wait tbh, actions taken are needed in whats to become a successfull business if you think they are not trying to not take advantage of the current economic climate then you need to make sure whats coming to you is gotton to you involve a debt collector as your last resort though 10 percent is a lot for what the carrot could get rather than sticks

diydan

You try to be as understanding as possible in times like this. However there will always be cases where the excuses don't add up or indeed may stack to high. In which case I suggest the following.

Buy a clapped out transit van for a few hundred euro, get magnetic signs for the back and sides saying "DEBT COLLECTOR" in big bold writing. Park outside your debtors house until you get paid. They won't want you hanging around too long.

diydan

BTW, on the back of invoices you often see that a 2% interest charge is charged for late payments. Is this enforceable? Does anybody know of anyone/ company who use it successfully?

readytorock

simple.........just make sure you get more time to pay up your suppliers than your customers get. ie. suppliers give you 40 day credit......you give customers/clients 30 days. this will give keep your business running smoothly, and avoids conflict on both sides for you. Been using this system for last 3 years yet it seems to be always overlooked!

me_right_one

EI-EAY wrote: »

You can get a debt collection agency to collect at 10% no collect no fee if its a larger debtor.

Obviously using them depends on how much you value your customers. Theres a fine line between sucessfully getting cash in and loosing customers from pushing for it.

Any reputable suggestions?

lanternman

Before you go sending the dogs around I think you should ask yourself a few questions!

Granted you need to get paid, but if you send the dogs around are you going to ever get repeat business?
Have you done everything in your power to get paid? If the balance is high enough have you gone to meat them and sought at least part payment and regular installments for the balance.
Have you done your homework on the company? do they still exist and how are they doing?
What can you do going forward to stay on top of debtors?

nice1franko

Depends on the type of business you have... but maybe try something like:

Hi [..],

A quick note to say that I am really disappointed that you have still not paid me the [..] that I’m owed for the work I did for you. In the grand scheme of things, it’s not a lot of money, but actually I think that this is more a matter of respect.

I have always been there at the drop of a hat to sort out any problems you might have. I love working with you and have always taken our relationship as more than just client/supplier. But if I can’t rely on you paying promptly or it takes several attempts and reminders to get my money, that’s not good business.

I’m not saying that I don’t want to work with you, I do. But if I don’t receive what I am owed within the next couple of days, I will have to think twice about helping you in the future.

Kind regards

- http://www.s-consult.com/2009/03/18/best-email-collection-letter-ever/

Verbal_Kint

times are hard for everyone but business is business.

flat out ask them if they can settle their invoice within 30 days.

if the answer is no ask them if they will agree to a 6 month payment plan (if that works for you).

if that doesnt work you must get the debt collectors in otherwise your soft handed approach will put your business in jeopardy.

keeping customers sweet is necessary but if they dont pay their bills within a reasonable agreement you are better off not having them as customers.

me_right_one

Which debt collectors can you trust though? Who do you turn to? They all seem shady

R3al

diydan wrote: »

BTW, on the back of invoices you often see that a 2% interest charge is charged for late payments. Is this enforceable? Does anybody know of anyone/ company who use it successfully?

Under the 'Late Payments in Commercial Transactions' Regulations you are entitled to charge 8% interest (7% + ECB rate) at a daily rate of 0.022% on late payments, (this only applies to b2b and public bodies) the regulations stipulate that the purchaser should pay the interest automatically on any late payments and it is not the responsibility of the seller to notify the buyer of any interest that is due, also the seller is entitled to claim compensation for reasonable recovery costs and does not have to cite any evidence of the recovery costs that were incurred

You can also set your own late payment interest terms in your agreement with the buyer

Verbal_Kint

i assume there are regulations and the larger the company the more likely it is to be reputable.