Regardless of your size of company, it’s more than likely that you have some pesky customers that either avoid paying your invoices, or use delay tactics to buy them time. Time evades us, one week becomes two and before you know it you find that your debtors list is increasing. Having the time to proactively chase debts and monitor the situation can often be a luxury many companies don’t have. However, no business wants to get caught with a bad debt and a cash flow issue.

Before you consider sending in the heavies, let’s adopt a more humane approach and take a look at your Credit Control process. A robust and effective system is required to ensure that you only provide credit to customers who are able to pay and that they are likely that they’ll pay on time. You also need to ensure you have the correct specialist skills in your team, it’s not an easy job asking for money.

So, you have your Credit Control system and people in place, but there will still be invoices that won’t be paid - how do you get your invoices paid?

  1. Do your Due Diligence

Credit management includes assessing the financial risk of customers from day one, before they buy anything from you. You may decide that they go on proforma if their credit rating is poor or you could set a credit limit so that you reduce your risk.  Customers’ credit ratings should be periodically monitored, just because a company is financially secure today, doesn’t mean it won’t encounter turbulent times along the way affecting their credit score.

  1. Explain Payment Terms

Set your payment terms out from the beginning and include them in the contract if you use one, as well as clearly stating them on the invoice itself. Ensure that they are aware of them via verbal and/or written communication.

Also obtain knowledge of your customers’ invoicing approval process. If they only have one payment run a month and you invoice incorrectly and have to re-submit you could be waiting over 60 days before you receive payment. Not only that you may have a policy of 30 days payment, but the customer’s policy maybe 60 days. It’s ideal to gain an understanding and agreement at the outset of the business relationship.

  1. Invoice the Correct Person

Your main contact may not be the correct person to send the invoice too and it could find itself either sitting in an in-tray or being passed around the company. Establish who the invoice needs to be sent to, is this your contact, the finance team or a third party? Should it be posted or emailed and if the latter who should be cc’d.

  1. Make Your Invoice Easy to Process

Avoid time being wasted by having a clear, easy-to-understand invoice with the correct information, after all you don’t want a customer paying late because they’re confused about how much they need to pay and for what. A clean template layout with clear descriptions of the products/services purchased and simple instructions of how to pay will make the process of sign off a lot simpler, which means you are more likely to get paid on time.

Be clear on how you wish to be paid. A popular method is via BACS, but you may want to choose via PayPal, phone or your own online payment system.

  1. Build Strong Relationships

No matter how great your credit control process is, there will always be customers who avoid paying on time. Having a great relationship will most certainly help with getting your invoices being bumped up the payment priority list. By taking the time to build an open and transparent relationship a personal connection can be established. No one likes letting down a friend, okay you might not be friends, but it’s more likely that they will speak to the Accounts Department on your behalf.

  1. Send Friendly Reminders

Before the invoice becomes overdue, put a flag in your calendar or system to send a friendly reminder, sometimes customers simply forget so will be grateful to receive a nudge. Also make gaining confirmation of receipt of invoice part of your process. Nowadays emails can end up in customers’ spam folders or you may have made a typo in the address and it never got there in the first place.

At Advantage Services we hear the challenges that businesses encounter with their credit control processes and as a result have developed a Credit Controller Add-on compatible with Sage 50 Accounts. The Credit Controller Add-on;

  • Enables multiple reminders to be sent which can be tailored to each client
  • Automates the process with no staff intervention
  • Frees up resources to use elsewhere
  • Reduces the possibility of customers being chased incorrectly
  • Improves business cashflow by getting debt in quicker

Don’t wait for customers to pay you late, put in the correct steps to make your credit control process efficient and effective. If you would like more information on our Credit Controller Add-on, either call our friendly team on 0330 335 0011 or email


Posted at 7.47am on 25 May 2021 by Dawn Smiley in category General
Tags: Accounts