Does Your Company’s Vision Include Billings and Claims?

“Chase the vision, not the money; the money will end up following you.”  –Tony Hsieh, Zappos CEO

Hsieh expresses a basic tenant of business success. But money is important to your success. You can remain true to your vision without the exhaustion of dealing with overdue invoices and ill well generated if you are perceived as an obnoxious and annoying bill collector. Your clients and customers should have a positive experience from the first time they see your business name until their business with you is concluded. Prevent billing issues right from the first sale by having a solid billing plan that you and your employees faithfully follow.

Begin with what forms of payment you will accept. Everyone loves cash, but you should have a way to check large bills for counterfeiting. Your customer may not know the bills are counterfeit, so handle this issue carefully. Never blame the client for trying to use the fake currency. Assume he has been duped. Fitssmallbuisness.com details how to check for counterfeit currency. Every employee authorized to accept cash should know how to spot a fake bill. If in doubt, a nearby bank can verify the currency but check with them before you open for business. You don’t want to be running around with your customer looking for a bank. If this system is in place, your business will look organized and the process will be seen as part of the transaction. Checks are chancy, but checks from a local bank are more likely to be paid. Choose credit cards that offer a way for you to verify the purchase will be paid for. For on-going payments, automatic withdrawals from a client’s bank account seldom fail. For large charges, electronic funds transfers are an immediate way for you to collect what is owed.

The terms of payment are also important. If the transaction is small, inform the customer which forms of payment are accepted. For a service such as construction and landscaping, you will want a contract. This contract, signed by both parties, should detail exactly what services will be provided and a good faith estimate of the cost, itemized by materials and labor. The contract should include a payment clause. When is a payment due: half down before work starts? after project completion? how long after completion? The contract protects the customer from worries about unexpected charges and protects your right to be paid for the materials and services you provide.

Despite thoughtful payment policies, you will likely have a problematic billing issue now and then. “Panic last” is one of the personality traits of a successful business owner. A friendly phone call is a good first step. Some payments may be late for a good reason or the bill “slipped my mind.” The call reminds them. Be prepared to offer payment options that you can live with such as payment at a later specified date. Be sure to follow this option up with a letter. Mailed overdue notices are easy for the sender to ignore and so impersonal they may seem insensitive. Perhaps a family member has been hospitalized and extra time is needed for the household paperwork. With a phone call, you can express your sympathy and help to become part of the solution.

When all else fails, you may want to turn the problem over to a collection agency, which will cost you 30 percent or more of the debt collected. You can also file a claim in small claims court. This is where a contract proves the terms of the transaction.

When it comes to billing and claim issues, often it makes good business sense to seek outside services. We can tell you about what resources you need to manage this aspect of your business. To learn how we can help, please Contact Us.  We look forward to talking with you and becoming part of your vision for a successful business.