Cash flow management is a game with strategy behind it. Sometimes, trying to work out where a payment is buried inside complicated client organisation structures can be as hard as working out who is aligned to whom in Games of Thrones.
While most of your clients are probably excellent payers, even a very small percentage of clients being tardy in their payments can lead to cash flow battles’ royale for professional service firms.
As such, it’s crucial to adjust your cash flow game for the sluggish ones, by applying a unique strategy to match their payment persona.
For example, while some seem to have a well-worn playbook like “The cheque’s in the mail”, others are merely disorganised or reliant on manual systems and don’t mean any harm.
Typical tardy payer personas of clients of professional service firms include:
- The Shambolic – are they disorganised and always forgetting to pass on your invoice to accounts for payment?
- The Restructurer – are they forever merging or demerging, so you never know what’s where?
- The Holiday-maker – are key staff always on holidays, leaving your payments hanging?
- The Mis-communicator – is there miscommunication and blame between siloed departments?
- The Bank customer – are they purposely using you as a bank?
To get around this intended or unintended consequence for your business, play the cash flow strategy game by matching negotiating technique with persona to help you get paid faster. Here’s five tips …