Patricia Anderson No Comments

The Best Payment Terms for Faster Cash Flow

A great way to speed up your cash flow is to get paid faster by customers who owe you money.  One way to do that is to examine your payment terms to see if you can accelerate them.  First let’s talk about what payment terms are common.  Then I’ll share a study that showed which payment terms generate the fastest payments. Read more

faster cash flowsEnglish, Please

Traditional payment terms are spoken in the following format:

Percentage discount/(Days due from invoice date), “Net” (Days due before payment is past due)

An example is 2/10, Net 30.  It means to the customer that if they pay within ten days, they can take two percent off of the invoice due amount.  If they don’t want to do that, they need to pay the full invoice within 30 days of the invoice date.

You could write “2/10, Net 30” on your invoice, but you will get paid faster if you write it out in plain English.

Industry Standard

If your industry “has always done it that way,” I encourage you to challenge the status quo.  Getting your cash faster is important to all small businesses, so don’t let your industry hold you back.

Discounts

Most corporations are required to take discounts if they are offered, so offering an early pay discount might help you get paid faster.

Insights

There are several studies on how to get paid the fastest.  Of course they all have different conclusions!  FreshBooks advises that “due upon receipt” terms can work against you as most people decide that that can mean anything.  They suggest using wording that says “Please pay this invoice within 21 days of receiving it.”  Here is their blog post on the topic:

http://www.freshbooks.com/blog/the-best-invoice-payment-terms-to-help-you-get-paid-faster-and-more-often

Xero produced a page on the topic as well. Their research suggests that debtors pay bills 2 weeks late on average.  They also suggest using terms of net 13 or less in order to get paid within 30 days.  Here is their page on the topic:

https://www.xero.com/us/small-business-guides/invoicing/invoice-payment-terms/

Feel free to contact us if you’d like help deciding on payment terms for your business.

Patricia Anderson No Comments

Cool Apps: Zapier

Do you need to get data from one app to another?   If so, it’s time to check out Zapier.

You might be moving data manually from, let’s say, your shopping cart to your CRM or from Evernote to Google Docs, or something like that.  Zapier allows you to automate the process with what they call a Zap. Read more

zapierHow to Use Zapier

In the Zapier app, click Make a Zap, and you’ll see two dropdown menus:  Trigger app and Action app.  Your trigger app is the one where the data is stored and your action app is the one where you want the data to be moved to.

Continuing the shopping cart example above, you would choose your shopping cart app as the trigger app.  Zapier support BigCommerce, Ontraport, Infusionsoft, Shopify, Magento, and more.  It will then ask you for details about the transaction and the type of data you want to port over.  Your action app will be your CRM, and Zapier supports dozens of them.  It will ask you for your user ID and password for each application and some more specifics about the type of data you want to transfer.

 

You can run your zap one time or every fifteen minutes, depending on the nature of your data transfer.  Here are some ideas to get your creative juices flowing:

  • From Evernote to Google Calendar, add an event.
  • From your blog to Facebook, post your latest blog entry.
  • Create QuickBooks Online sales receipt from PayPal
  • Create QBO customer from Salesforce (or other CRM)
  • Develop a Constant Contact contact from QBO customer
  • And several thousand more combinations!

The admin time you will save will amaze you.  Data entry and moving data around is truly becoming a thing of the past.  You can go to Zapier.com and create a free trial.  There is a charge for a larger number of zaps.

And, as always, if you’d like our help, please reach out.

Patricia Anderson No Comments

Attract More Customers with Event Marketing

Holding your own event is a great way to meet new people and allow them to sample your business in a low-risk setting.  A face-to-face event allows you to build trust quicker than many other marketing methods, and trust is almost always required before a sale can be made. Read more

event marketingTypes of Events

 Some of the more popular types of events you can hold include:

  • A seminar or class
  • An open house
  • A neighborhood sale
  • A networking meeting
  • A reception or party or celebration or festival
  • A conference

 If you’re new to holding events, start small and/or join with another business so that you’ll have a larger number of people to invite.

 Participants 

 Once you’ve decided on the type of event you want to hold, you’ll want to determine who you will invite.  Will it be clients only?  Will you join with other businesses and combine your lists?  You’ll want to invite a larger number of people than you might think.  If the event is free, there may be several no-shows, even if they have RSVP’d.   The more formal the event, the fewer the no-shows.

Topic or Purpose

For the best turnout, choose a topic that’s interesting to your clients as well as relevant to the services you offer.  Provide education that the customer needs, a new money-making strategy, a new product or service roll-out, or something that will affect your customers’ well-being, and you’ll experience the best turnout.

Spread the Word

Now that you’re ready to hold your event, it’s time to get the word out.  Plan on sending multiple emails (more than you might be comfortable with) to let people know about your event.  Email is a good way to notify people, but if you have the budget, mail invitations.  Call the most important people and let them know you want them at your event.

Have Fun and Make Money

 Be sure to have a high ratio of staff to guests so that more than one of your staff can meet each person.  Enjoy your event, and hopefully, you’ll be able to get to know many future customers there as well.

Patricia Anderson No Comments

Five Modern Marketing Methods You May Not Know About

Older marketing methods like direct mail and cold calling just don’t work as effectively as they did a few decades ago.  There are two reasons for that: Read more

  1. modern marketingThe trust level between people has dropped more than 20 percentage points in the last few years; people are more skeptical and untrusting of each other than ever before.
  2. The amount of marketing messages we receive on a daily basis has increased exponentially, to the point where most everything is simply treated as white noise.

What is there to do if you still need more clients?  Sharpen your marketing skills and try out these newer ideas from the 21st century:

Website Landing Pages

A landing page is a web page that is not listed in your website menu.   It’s a hidden page that advertises something very specific, such as a free report, a service, a niche, or a sale item. The landing page includes a description of an offer and a call to action, such as a Buy Now button, or a signup form where you enter your name, email, and possibly phone numbers.

You can drive traffic to your landing page through social media, online ads, or email notices.  Once someone has taken action, a sale team often follows up with a phone call or an email to encourage further action.

Free Trials or Samples

Although there is nothing new about free trials, they are certainly popular and they still work very well.  You might think they are only for magazines and software companies, but it doesn’t have to be that way.

You can offer free food samples or free servings if you own a restaurant, catering or other food service company.  If you own a training or consulting company, you can offer a free course or a free consulting hour.  Physicians often offer free pharmaceuticals, and dentists offer free toothbrushes.  Think about how free trials or samples can be used in your business to attract new clients.

Webinars 

The online equivalent of a class or lecture is a webinar.  If your company sells a product or service that requires a lot of client education, you can deliver this information via a webinar.  The benefits to offering a webinar are that people do not have to get dressed up to go anywhere,

you can have people from all over the world attend, and people will be able to get to know you and how you think so they can make a decision about whether they want to do business with you.

To offer webinars, you’ll need webinar software such as Citrix GoToWebinar or WebEx.  You could also use Google Hangouts for free, but the number of people attending is limited.  Invite people you know via email announcements or social media.  You can make a sales offer during the webinar as well.

Email

Email is a great way to make sales offers to people, especially if you have a list of people who have given you permission to send emails to them.  If you send out a monthly newsletter, include a Product of the Month or a Deal of the Month.  It’s much less expensive than direct mail, and often there is a much better response rate.

Online Ads

If placing ads in newspapers and magazines is not working in your industry any more, then try placing online ads.  There are lots of choices.  You can go with Google AdWords and Facebook Ads.  Twitter and LinkedIn have ads as well.

You can also try banner ads.  There is a special type of banner ad called retargeting.  Have you ever been on a company’s website, then left it and started seeing advertisements for that company on the websites you visited later?  That’s called retargeting and it’s very popular.

Before you create your marketing plans for next quarter, give these ideas some consideration.  You may get more bang for your marketing dollar.

Patricia Anderson No Comments

Your Daily Numbers

Some numbers need reviewing on a daily basis, and one example of this is cash.  When cash is coming in from a number of places, it’s great to have a daily summary of what was collected. Read more

Daily Numbers

It’s recommended to make sure all the collections hit your bank account to feel confident that no errors were made.  Furthermore, a daily cash reconciliation report will serve both needs very well.

A daily cash report will vary depending on the type of business you have, but it will look like a combination of a bank reconciliation and a sales report wrapped into one.

The below report is useful if you are managing your cash closely daily. You’ll need two very brief spreadsheets to get started.  The first one below is your daily sales from all sources.  Your accounting system may be able to generate this.

Today’s Sales
Cash $300.00
Checks $600.00
Total Bank Deposit $900.00
Mastercard Visa $400.00
American Express $200.00
Total Credit Card Due $600.00
PayPal $100.00

If your accounting system is up to date, all you’ll need to do is pull the cash balance and adjust for today’s activity.  The following day, you can double check your accuracy and adjust accordingly using the last two rows.

Daily Cash Report
Book Cash Balance $5,000.00
Deposit from Today’s Sales $900.00
Merchant Deposit $600.00
Less Checks Written Today ($1,200.00)
$5,300.00
Expected Bank Balance Tomorrow $8,300.00
Actual Bank Balance $8,300.00
Explain any differences

Reconciling the Bank and Book Balance

If your accounting system is not updated in real time, you’ll need to start with the bank balance and correct it for uncleared transactions as well as list today’s activity.

Daily Cash Report
Bank Balance $5,000.00
Deposit from Today’s Sales $900.00
Merchant Deposit $600.00
Less Checks Written Today ($1,200.00)
$5,300.00
Checks Still Outstanding ($3,000.00)
Deposit from A/R Paid $5,000.00
Expected Bank Balance Tomorrow $8,300.00

Using these formats, you can easily extend them to cover the entire week.  This way, you’ll know what your cash balance will be from day to day.

In conclusion, knowing your cash balance can avoid many issues such as bounced checks or fees due to lack of cash. In addition, simply being aware and in control of the flow of cash helps operations run smoother.

If you see the value of this report for your business and would like help creating it, please reach out.