One of the more important aspects of your startup business includes effectively managing cash flow. If you don't have regular cash coming in, you won't stay afloat for long. You may start out with just business loans and investment money, but as the months go by, you need to supplement that money with cash flow from customers for ongoing sustenance.
It's always stressful to keep hounding clients for payment months after sending the invoice. However, thanks to invoice financing, you can guarantee you'll get much of the money owed to you despite when your client finally pays. Basically, you're selling the overdue invoice to the company, who pays you between 70 to 90% of the total amount so you can keep a cash flow going for your business.
It's a sad fact that the longer you have to wait for your invoice to be paid out, you'll have less of a chance of receiving that money. This is why you need a trusted debt collection company. This frees up your time so you don't have to go chasing up overdue invoice payments. After 60 to 90 days of unpaid invoices, bring in the debt collection agency to help you get the full amount.
What to Do
Bottom line is, your company has to maintain its cash flow and as such, you need to prevent the above situations from occurring. It just takes a few tweaks on your part to ensure your invoices are paid. Did you know that simply adding a "thank you" or "please" to your invoices can boost your chances of getting it paid by five percent? Also, make sure you word your invoices clearly so they are understandable to the client.
You can also employ the use of incentives, such as offering a discount if your clients pay up on time. Everyone likes free money!
Maintaining a steady cash flow for your startup is crucial. Get started on the right track!