With the recent release of the ‘Joker’ film I thought it appropriate to talk about the jokers we all encounter in business.
As a Small Business Owner, do you sometimes feel that there are too many Jokers out there taking the absolute P when it comes down to paying you on time?
They always seem to think of some reason to delay payment but, like Batman, you need to outsmart these Jokers to avoid their tricks.
Here are some off the ten top culprits I’ve come across:
- “The Owner (or the Authorising Party) is away at a meeting/holiday/lunch/on the phone etc etc…”
- “We’re not happy with the Fee or the type of service that you have offered”
- “Send me some documents that show the current debt”
- “I will pay you next week, we promise” …. yet weeks pass and nothing is received.
- “I spoke to ‘so-and-so’ in your Company and they have confirmed that I don’t have to do anything until ‘such-and-such’ date.”
- Random and acrimonious payments are received on the account, without any explanation.
- You arrange a meeting and the indebted party doesn’t turn up.
- Your Customer simply ignores all communication (Ignorance is bliss, right?)
- They have disappears off the face of the Earth…
- The company goes into insolvent knowing that you can do nothing about it.
All of the above are excuses these Jokers put in front of us when we attempt to claim what is rightfully ours.
So, what can you (yes You) do to overcome the issues put forward?
Let your ‘Robin’ do the communicating
Depending on the size of your organisation, you may have a Sales Contact, if so, get them onto the Customer for you. After all they are the ones who have established a better range of communication. Think of them as the Robin to your Batman.
There are of course, genuine Customers out there, but there are those out there who will be willing to pull out all the stops in avoiding paying you. By getting your Robin to keep the communication momentum ongoing, there is less time for them to avoid paying you.
Use email as a weapon
Sometimes customers will ask for items such as the Invoice and/or a Statement of Account to be resent.
A Word of Advice here – if at all possible – ask them to email you the request, and then email back the requested document.
By having crucial documents to hand and a trail showing you complied to their request, you are likely to resolve these issues more quickly and assertively.
As a rule of thumb, once you have finalised a call and/or meeting, send an email to the Customer to verify your overall conversation.
Be on guard to their delay tactics
I once had a Customer confirm that he had cleared the payment and that the proof had been sent to my Robin (the Sales Guy). After speaking with the Sales Consultant, it quickly became clear that the Customer was being a Joker and this was all clearly a delay tactic.
Sure enough, after fired a quick email off to him, further communication was received calculating the correct payment date.
Keep track of your incoming finances
Sometimes random payments may turn up in your account. These are probably few and far between if you are a one or a two man soloprenuer or a smaller company. However, if you are a slightly larger company which receives many different payments, it’s sometimes difficult to decipher a breakdown of these payments.
Perhaps a general rule of thumb would be to allocate against the older invoice. Standard practice right? – but this depends on the culture, and type of industry that you are operating in. One can’t add the payments across Invoices outstanding willynilly … or can they?
Build your own Justice League
This strategy might come into play with 90 days+ overdue invoices.
Try to utilise your arsenal of Sales Team to participate in a joint team meeting with the Customer. This way you are resolving or trying to resolve the bad debt issues that have been bought about.
“I am just a one man or two man band” – I hear you say.
Ok, take a friend, or a trusted coach or advisor to go along with you for some extra support or company to lend a hand in resolving any issues/disputes that may arise and stop these Jokers from disappearing for good.
Arrange to meet at a mutual area between you and the indebted party.
Spot the Jokers before you get involved
Perhaps the most frustrating thing of all is that, as an unsecured creditor, there is little or nothing that can be done, depending on the type and value of the debt. Therefore it’s important to try to avoid doing business with these Jokers in the future.
By grasping the above tips earlier on, it’s likely that you have a key relationship to avoid falling into this trap later on.
One example of this is when I was working in the drinks industry. One of our high-ranking Sales Director did a drop hands deal on a £25k loan, without the need for a Guarantee. Around 3 months after the Loan was signed for, the Customer placed the company into Liquidation, standing us in as an unsecured creditor. What could we do – absolutely zilch. So make sure, that if you do over a goodwill gesture, then this is agreed upfront by your key decision makers.
Remember there are many Jokers out there who will try every trick in the book to avoid paying you, so make sure that you are upfront with them, to avoid them making a laughing-stock out of you …..