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5 tips from your tax accountant in Surry Hills

5 tips from your small business accountant

Starting a small business can be a harrowing experience requiring all sorts of planning, long hours and endless meetings. It can almost be a relief to reach the point where you get to do some billable work and invoice your clients! After all, that's what you really love doing and why you started your own small business in the first instance.

Of course, winning clients and creating billable work is only part of the process and is all to no avail unless you actually get paid for your hard work. As we offer small business accountanting in Sydney we appreciate that collecting accounts receivables can be a nervous experience for many small business owners. That's why we've complied this list of the top five keys to actually getting money into your bank account.

  • Before even doing any work, scope out who is responsible for paying you. If it’s not your usual contact, then find out who pays the bills for your client so you can contact them directly. Keep a clean direct line of communication between yourself and the accounts person at the other end. Make sure they get your invoices and are aware of your payment terms. Perhaps your client uses a bookkeeper who only pays bills once a week or month. Find out when that is and make a date to target them on or before that day.
  • Make sure invoices are issued to clients as promptly as possible. This sounds quite simple, but consider that we once had a client who only issued invoices at the end of each month, which meant some clients weren’t invoiced until 30 days after a job was completed. Payment terms were 30 days. So an invoice paid, even though it was one time, was taking up to 60 days from the time the actual work was ready for invoicing. No small business can afford these sorts of cash flow issues!
  • Be clear on your payment terms from the outset and make sure they are in a clear font on your invoices so there can be no confusion.
  • Offer multiple avenues for payment. Using BPAY, PayPal direct debit and credit card facilities can all have varying levels of success, depending on your industry. Again, make sure your client knows about these options by including them on the actual invoice.
  • Statistics demonstrate that the longer an invoice is left unpaid, the harder it becomes to collect. Once the due date for payment has passed keep in regular contact with the client (perhaps every seven days) by telephone and email so they can’t forget about you. It also gives the client the option of discussing any job related issues that may be holding up payment.

As a small business owner you should never be too shy to ask for payment for work that was agreed to, completed to the best of your ability and invoiced to the customer. Holding back on requesting payment is only ever going to hurt one person ,and that's you, the small business owner.

For more tips on managing your cash flow and keeping a healthy bank account mas accountants are always available to discuss your small business needs, whether that be here at our Surry Hills office where the coffee is free, or via email and telephone.

 
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