What if you could spend your sales? I sell widgets, then take the invoices and pay my employees. They take the invoices and pay their mortgages. Who needs dollars when you’ve got sales? Unfortunately, we can’t pay for anything with sales. We must convert our receivables to cash and preferably within terms.
Today I participated in a meeting with a client and his customer. The customer owes $20K in receivables and is well past his terms. The problem is not his willingness to pay but his capacity to pay. As Yoda would say, good intentions make a good customer not.
If this was your customer, what would you do? Leave your comments below : )
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I have encountered this quite a bit lately with my clients in this economy. To recover funds I took an understanding approach with my client’s customers. Appealing to them on there level by letting them know that we understand and are in a similar position. To collect we have made payment arrangements with specific terms and deadlines that work for both my client and there customer. Additionally we maintain a non-threatening line of communication to keep them in contact with us, which has allowed us to maintain our business relationship and an understanding that were working together to accomplish a single goal of being successful in a struggling economy. Iam intrested to hear what your resolution to this situation was / is.