Cashflow management still remains a key concern amongst smaller businesses, but helping matters along has been the increased engagement from larger companies with the Prompt Payment Code. 1,300 organisations and counting have already signed up a commitment to paying their suppliers to agreed terms that are fair and reasonable.
Whilst the Prompt Payment Code is not new ‘legislation’, it does show UK business rallying to support better practice. But the best way to support suppliers or customers, is to ensure a business has the information and tools required to develop mutually beneficial trading relationships.
At ReadSoft we recognise that many small businesses have struggled as a result of late or unpaid invoices, and while we heartily encourage business sign up to the Prompt Payment Code, smaller companies simply cannot rely on the good will of larger businesses. Balancing the books is essential to your business, but the staff time it takes to do this would be better deployed on generating new business for your company. The frustrating thing is that most non-payment is likely to be the result of poor or slow administration – in other words it is not that your customer cannot pay but that they have probably lost your invoice it in a morass of paperwork.
What you can do is ensure that your own administration is on the ball. Regularly remind customers that invoices are due, chase them for a date for payment and build a relationship with their accounts team. Make sure they have your bank details and other critical information. This should help to give you a better idea if they cannot pay or if they simply need to tighten up administration.
And being small no longer means that you are at a disadvantage when it comes to technology. You simply need an internet connected PC, tablet or even mobile phone, because new developments in Cloud computing allows you to only pay for what you need, so there is no capital investment.
ReadSoft now offers an automatic invoicing service which we call ReadSoft Online, which lets you scan, upload and send documents and invoices. The software automatically extracts important data, verifies it, and sends it to relevant applications. It also stores the information remotely for you to access at will. You get access to the same financial software available to big companies, which automates your invoicing, improves your operations and makes you look more professional. Plus, you have the freedom to scale a service up or down as your business demands it so you can plan for growth or tighten the purse strings as required, and keep a tight control on that all important cashflow.