This is the bane of my life.
We offer 14 day payment terms. We are not a bank. Nor a credit card company. We are a business who rely on cashflow to keep us going. We offer 14 days payment terms as a matter of courtesy to our clients. So why then do some businesses continue to flout this luxury?
I've come for my weekly shop and I won't be paying!
|We pay on time! Do you?|
Mike tells me that it is not uncommon practice in the Construction Industry that people don't pay on time and need constant reminders and threats of legal action. But why is this? And just because that's whats done doesn't make it right.
Good old fashioned manners
If another business is suffering from cashflow issues we would of course do our best to assist. Again - it comes down to manners and courtesy. At least informing us of the situation and advising what you are doing to rectify it.
I have taken to sending out 'reminders' to customers before an invoice becomes due so that we can do away with the 'I never received the invoice' scenario (incidentally we send our invoices with our final drawings so if you got the drawings - you got the invoice!). Then when it becomes overdue I send a nice gentle reminder, then another, and so on.
When is the right time to take the matter further? How overdue should an invoice be before you start adding on interest and Late Payment Compensation (did you even know that you can do this? - See payontime.co.uk for further information). Should we only chase debts over a certain value? When should you take a customer to court?
I don't know the answer to these questions. In fact there is probably no hard and fast rule. I would however be interested to hear your thoughts on the situation.
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