September 30, 2019Late Payments
Businesses are slowly getting better at paying on time, but sadly for wholesale distributors, this is far from the truth. Wholesalers are still suffering from the late-paying habits of their retail customers.
According to Xero’s recent study, the retail sector remains the slowest payment times, paying bills an average of 23 days late. This, of course, is bad news for wholesalers.
Wages, the pressure on profit margins, increasing costs of fuel and keeping up with growth and the cash flow challenge becomes a daily concern.
So here’s how wholesale distributors can get paid faster.
Send clear invoices to your customers.
Clear invoices are the first line of defense when it comes to getting paid on time as a wholesaler.
When designing or selecting an invoice template, ensure the essentials are in the best possible location, are easy to read, and stand out.
Make sure that the balance owing, due date, and payment information are 100% clear to your customer.
Include every type of payment method you accept, with details on how to pay each one.
By doing this, clients won’t have to go searching for details in order to pay.
Also, require proof of receipt on your deliveries to avoid any discussions about when or how the goods were received.
Clarify and work out payment terms upfront.
Make sure that everyone involved knows exactly what the payment terms and expectations are. Make it clear when and how much is due for every part of the order.
Automate the manual tasks
Automating payment reminders and invoices is key. Rather than having to remember to chase people up yourself and send out invoices manually, utilizing technology will increase productivity and help you get paid faster.
Keep On Reminding!
By constantly sending friendly reminders to your retailers you increase the chances of getting paid and retaining a good relationship with that customer.
Improve debtor visibility
It’s difficult to maintain a good visual overview of overdue debtors. Many businesses are trying to piece together the complete picture from multiple sources and some payments go unnoticed.
Having a place where you can keep an eye on all your customers is essential as you’ll be able to physically see who is paying and who isn’t.
The keys to better cash flow For Wholesalers
- Remind customers to pay. Automate your reminders to consistently get your overdue invoices noticed.
- Manage debtors easily by holding all your information into one central source. This becomes your debtor management system
- Track every invoice to payment. Even the low-valued invoices need your attention too, it all adds up.
All seem a bit much?
Chasing payment is a real time-consuming task. However, we have a solution that can save you hours of your time and get money back in your pocket.
Customers using our platform, PencilPay, see a massive 82% of invoices paid within the first 5 days.
We automate the process for you and have all your debtors stored in one easy-to-manage platform. Businesses should be able to focus on what they do best and not be held back by chasing payments.
If you’re interested in getting your invoices paid on time, book a demo with us today!