Awkwardness using the ‘M’ word & how to reduce the stress of credit control
Unlike our American cousins, the British are known for not wanting to discuss or ask for money and for many small business owners, the awkwardness of credit control, chasing for payment and even discussing the dreaded ‘M’ word is a major headache. Not being able to effectively chase payments puts small businesses in a very tricky position. It means that you end up having a shortfall in your cash flow, and as we know maintaining a stable and healthy cash flow is essential for all small businesses to succeed and expand in the future.
However, there are ways to reduce the awkwardness. One extremely credible and viable way is by employing the services of an accredited financial funder that specialises in small business invoice finance, such as Partnership Invoice Finance. Partnership Invoice Finance removes small business owners from that uncomfortableness as we can handle all of your credit control, manage all payments and do the chasing for you. Leaving you able to concentrate on keeping the ‘zing’ in your business and future planning.
What happens if money issues are left unaddressed?
On the business side …
Leaving money issues unaddressed and not managing to secure the payments your business is owed means that you are put under unnecessary financial strain – through no fault of your own other than feeling uncomfortable asking for money owed. As a small business owner, the last thing you need is unwarranted financial pressure. You want to be able to relax and concentrate on your business, safe in the knowledge that cash is free-flowing into your business and stable. By leaving payments owed uncollected you will undoubtedly find that it will impact your business and its success.
On the personal side …
Leaving money issues unaddressed leads to increased pressure and anxiety for small business owners. Many find they are left worrying about how they are going to pay their bills, their staff etc and suffer through sleepless nights and high levels of stress. This all impacts their ability to be at their best for running and overseeing their business.
Ease of credit control management.
Managing your credit control is a daily task and one small business owners struggle with – especially in the UK. This is because as a Nation we aren’t great at asking for and chasing for money owed to us.
Traditionally, credit control management was always managed by telephone, but with advances in technology, it can now be done via emails and message alerts. However, taking away the personal aspect of chasing for payment can often make it easier for clients to ignore. Receiving a personal phone call tends to produce a quicker response as people are more likely to act as it’s harder to ignore an actual person as opposed to an automated message.
How can invoice finance help?
Invoice finance is a flexible and viable way to maintain positive cash flow without having to take on new debt, inflexible loans or pledge personal assets. It is a specific type of asset-based lending, which allows you to receive an advanced payment against the value of unpaid invoices. Simply put, the funder allows you access to an amount equal to a fixed percentage of your unpaid invoices (usually between 70% and 90% of the total) before they have been settled by your clients.
Contrary to widespread belief you retain 100% of the invoice value and only pay a small fee for the use of the facility – like you would any finance product. Invoice finance is a tried and trusted way of helping businesses keep their cash flow healthy, with the ability to help the business grow. In the UK approximately 35,000 businesses regularly use invoice finance companies with some £27bn of funding available.
How Partnership Invoice Finance can help your business
Accredited companies such as ours not only help you with your credit control and cash flow, but we also offer our clients the comfort of knowing this important aspect of running a business is taken care of, giving you one less thing to worry about.
When a business enters a factoring arrangement, whilst the funder is responsible for collecting payments from your customers themselves, they do not have any say in who you work with or which projects you take on. You still make all the critical business decisions and remain in full control of your business.
Appointing a funder to manage your invoice finance is a big decision – one that you need to get right. Our team is made up of dedicated, experienced, and highly professional experts who understand the need for discretion and efficiency, we have the experience and expertise so call us today to discuss your options.