3
Effective Payment Arrangements
OBJECTIVES OF PAYMENT ARRANGEMENTS
The reason to make payment arrangements is to improve your cash flow while helping your customers. You want to effectively outline policies and procedures that will help provide your customers with options when they cannot pay in full. After all, getting paid something is better than not being paid at all.
The more options for payment that you offer, the better your chances are of making a sale and getting paid promptly. For example, you might miss out on a lot of good sales opportunities if you only do business on a cash basis. There are many different options available for you to use. Some common forms of payment are:
- Credit cards
- Debit cards
- Personal and business checks
- Wire transfer
- Online payments
- Money orders
- Cash
Customers who are struggling financially will look at their bills and decide which ones they can afford to pay that month based on what is most important to them. Mortgage payments normally come first on that list, followed by things like food, phone, electricity, fuel, and daycare. However, it’s your job to make your invoice important to them and to offer them realistic options so that they will be able to pay you each month.
HOW PAYMENT ARRANGEMENTS AFFECT YOUR BUSINESS
Many business owners don’t like to offer payment plans because it means more bookkeeping for them and a hassle they don’t want to manage. But there’s something important to keep in mind in this scenario: Someone who owes you ...
