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Use these three tactics to deal with slow-paying clients so you can avoid a cash flow crisis

by , 09 July 2014
If we were to make a list of things that frustrate business owners, 'slow paying clients' would make it on to that list.

The reality is that some clients take longer to settle their bills.

Since this has the potential to bring your business to its knees, read on to discover three tactics that'll help you deal with slow-paying clients so you can avoid a cash flow crisis.

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Avoid a cash flow crisis by using these three tactics to deal with slow-paying clients

Tactic #1: Put everything in writing

You can't hold customers accountable for payment terms that you haven't put in writing. If you're requesting payment within two weeks, clearly say so in the contract, says Tim Parker, the owner of ECS, a company specialising in financial and small business content.

Experts at the Practical Accountancy Loose Leaf Service share the same sentiments. They recommend you formulate a sound credit control policy that states your payment terms and make sure your clients are aware of what you allow and don't allow when it comes to payments.

Tactic #2: Send invoices right away

As soon as a job is complete or products are delivered, submit your invoice.

Parker says whether it takes the company 14 or 60 days to pay, the clock doesn't start until your client receives your bill.

Tactic #3: Build relationships

Get to know the people in charge of paying the bills.

Parker says if you can't meet them in person, meet them over the phone. Learn their names. Moreover, don't forget these people during the holiday season when you're sending thank-you cards.

According to Parker, 'people who know you as a person will do their best to make sure you're paid, especially if they know you as a nice person.'

There you have it. We hope these tactics will help you deal with slow-paying clients so you can avoid a cash flow crisis.
 

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