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Dealing with account receivables faster

Image courtesy of Rattikankeawpun at FreeDigitalPhotos.net

 Hello readers, are you having difficulties collecting your account receivables from customers? If yes, this post is for you. For those that do not know what account receivables means, it is the money owed by a customer to an organisation after goods or services has been supplied without the customer paying for it. So how do you get the money on time?

 - First of all , the quality of your products (good or services). It should be of an excellent quality. Customers would not like to lose an efficient and effective supplier. So if your work speaks for itself they will be willing to pay on time.


 - If the type of products you offer do not require customers to pay in bits or to pay after service then it will be better to collect payments before service. Some companies apply this, it might reduce the amount of customers you get, however, it could prevent you from writing off debts.

 - Services and goods produced after the customer must have ordered for them. Some of them are completed over a long period of time, so you might chase customers away if you require that they pay (for example a project) before you embark on production. When I say production it could be building a house. In this situation, it will be best to ask the customer for an initial deposit, and then the remaining payment will be based on installments. 

 After you may have completed 25% of the task you could ask for payment, then  50% of the task you ask for  another payment and then 75% and then 100%. You should not wait until the production is complete before asking for money as it could discourage customers, the huge amount of money could be unattractive. Make sure you always ask for it on time like a week before it is due (just like a reminder). You would have agreed on the payment plan before embarking on production.

 - Some companies use credit as part of their business strategy to keep customers and attract new ones. If that is your situation, make sure your credit tenure is short like a period of 30 days or you could set a maximum amount a customer before you ask them to pay you. Do not charge interest on the credit you give them. Your business as to be halal.

 - If credit is being offered by discretion in your company, then make sure you deliver a good policy to filter customers that are not credit worthy.

 - Lastly, if you have a lot of account receivables and you are having serious difficulty collecting them you should employ a receivable collection agency. That is their job if you get me.

 Halal means anything that is lawful Islamically.

 Keep checking out my blog regularly, cheers!


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