It’s never a good idea to do business is the dark! You should never just rely on trade references and this can give you a bunch of biased assessments. A simple business credit check from a national credit reporting bureau will show you any businesses credit history, this includes % of their default payments, past overdue accounts, and any legal pending actions etc. It’s possible to set up an automated service that will send you the companies credit score report for every new customer added for that month. You can pay $25 per month for 10 credit reports which are very affordable on any budget. One bad debt avoided in one year can pay for your investment 100 times over.
Invest in credit monitoring
There is a service that will allow you to monitor up to a 100 of your customers automatically at one time. In addition to the credit checks, I received updates if a client sold their business, filed for bankruptcy, sold shares in their business or even updated company details. It will also allow you to proactively make decisions when your customer’s circumstances have changed.
Make it easy to pay you
When sending your invoices you need to make sure that they are error-free and sent without delay. You will get a better response if you offer a number of ways to pay you (EFT, credit card, online payment, cash, cheque). By adding a simple PAY NOW button on every reminder/invoice you send out to your customers will make a huge impact on your cash flow. The PAY NOW buttons simply linked to an online (24/7) payments processor. It’s not uncommon to start to see payments coming in around 7 pm and 10 pm—I guess this when the kids are off to bed and customers start doing their banking—and on weekends too. If you want you can even set up an AMEX card to accept (with an automatic surcharge in place) and customers can make payments even faster.