Solution Quest
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Providing: Resource Solutions, Management Solutions, Marketing / Sales Solutions,
& Environmental Solutions
SOLUTION QUEST can provide a variety of services for our clients. Whether that means strategic planning, profitability enhancement, developing programs and systems, making a site visit, doing research, reviewing data, or document production. You only use Solution Quest as long as you need us
I was recently asked how do you deal with "valuable" clients who are slow to very slow pay? Here is my answer:
In over 15 years of consulting I have only had one client beat me out of my money and they went bankrupt. While there are some clients who will never pay in a timely manner here are some techniques I have used in the past.
First evaluate the impacts of lack of impact that slow pay really has. Items such as cash flow, overhead, cost of operating capital if any etc. Make sure you really know how much slow pay really hurts or does not really hurt. In light of that evaluation revisit your definition of "valuable client" .
1 When setting up a new engagement, do not just accept the work but offer some "quick pay " incentives and some slow pay penalties and get them to agree to the terms. This takes some finesse and some frank conversations about the impact of their slow payment.
2. Raise your prices to cover cost of money. Be prepared to process a quick pay discount. The key is to get their attention.
3. Put them on COD. If they have past due amounts delay starting a new engagement until the make at least a significant partial payment on the past due.
4. Be firm about the importance of getting paid...!
5. Shorten the billing cycle as much as possible and follow up.
6. Many times the person hiring has little or no control over when you get paid beyond approving the invoice. Have them initiate a meeting with the AP manager. The bigger the client the more important this is.
03/17/2018
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