0816_TOEFL-Test-and-Score-Manual-1997

74 ● 201 Great Ideas for Your Small Business
Discount Accounts Receivable
If people owe you money, try offering to discount the amount
owed—if they make a payment immediately. This incentive works
well if the client or company has cash but is holding back.
This works best if you propose a significant discount—at least 10
percent. Put your offer in writing and set a deadline for response. Include
a self-addressed, stamped envelope or overnight mailing slip. Even if just
a handful of customers respond, it may bring in some cash.
To avoid deadbeat customers, don’t extend credit. Accept credit
cards instead (see Great Idea #51). If you really need to extend credit, pay
for a credit check and call their bank. Require a deposit up front so you
can sleep at night.
Most collection agencies work on a contingency basis, usually keeping
about 35 percent of what they collect as payment for their services. Ask for
a client list; call other clients for references. Visit the company offices to
meet with the owner or manager. Don’t base your decision solely on price.
Paying a higher fee to work harder on your behalf may actually bring in
more cash.
GREAT
Accept Credit Cards
One excellent way to boost cash flow is to accept credit
IDEA
cards. Many customers prefer to pay their bills with
credit cards. That’s good for everyone. You get paid quickly while your customers
can pay off the bill over time, as well as take advantage of rewards and
points for airline tickets, hotels, and other perks.
If you run a retail business or restaurant or offer professional services,
such as consulting, production, or design, I suggest setting up a merchant
account to accept credit cards. The biggest benefit for you is this:
Credit card payments speed up cash flow because the money will hit
your account within a day or so. Although you will pay processing fees