Cash flow challenges are common for businesses invoicing customers, especially when faced with slow payments. A structured collections process is essential, as evidenced by a cybersecurity company that achieved a 98.7% collection rate over 26 years. Key elements include isolating collections responsibilities to back-office staff to maintain customer relationships and applying payment pressure respectfully. The approach reflects financial credibility and emphasizes consequences for non-payment. Balancing the discomfort of demanding payment while managing customer relations is crucial for effective collections.
Effective collections hinge on the consistent and respectful application of pressure. This positions your company as financially credible and communicates clearly that non-payment has consequences.
Demanding payment can be uncomfortable if customer relationships are close. It requires shifting interactions from social to transactional, which can be awkward for customers.
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