What evidence is there of your agreement to deliver goods/services and your client’s agreement to pay?
When your client’s account becomes past due and they suddenly develop amnesia relating to your agreement, what would you have to support your case? You may have anything from a 5 page signed agreement that would make any attorney feel they’d earned their fee, to an invoice noting payment terms, to a sequence of emails, to a phone conversation. Whatever the documentation you have carries some level of risk. The phone conversation entails a high degree of risk compared to a 5 page signed document which carries a very low level of risk. Consider how an independent third party would view the transaction. Even if the transaction details were discussed in a phone conversation, notes such as time and date of call and specific agreements lend some weight to your case. Make plans to be paid before the transaction and improved cash flow will result.
Cheryl Cook works to develop business relationships where her experience, knowledge, and ideas can help improve the small business owner’s cash flow. As the Executive Director of Pro Money Inc., Cheryl conducts workshops with the Chamber of Commerce and teaches adult education classes on topics related to cash flow. Cheryl publishes an ezine every other week titled “Cash Flow Tips for Your Business.” [http://www.promoneyinc.com]