By ROBIN RAINBOW
Christmas and New Year are slow times for getting paid. There is usually someone around to receive payments, but no one around to make them.
Over the holidays, payment delays increase by two or three weeks from the 60 days it normally takes New Zealand businesses to pay bills.
Many
firms have $40,000 or more in overdue debtors, which can increase over the holidays. Interest at 11 per cent a year on this is $723. For some businesses, this can be more than 10 per cent of gross margin.
If you do not get paid by December 20, the odds are you will not until January 20, so do your credit control now. This is more important for small businesses than large ones, as many small firms do not have credit controllers.
Tightly run businesses find it hard, or unproductive, to contact slow-payers, especially if they soon want to sell to them.
Professional debtor managers help you get paid without upsetting customers.
Often customers are unaware outsiders are involved, as good ones act like staff, but without being on the payroll. This gives small firms a professional image.
If chasing debts is not your favourite task, look at this option.Robin Rainbow
* Robin Rainbow is chief executive officer and founder of Accounts Receivable Solutions (NZ).
