A well-designed invoice form speeds collections

Posted on April 20, 2012 by Bruce Bloom

Some invoices don’t get paid right away because customers aren’t sure they are invoices. Do they look like invoices, or packing slips? Or monthly statements? Let there be no doubt about the form you use:  put “Invoice” in big, bold type right across the top. Make it very clear what the customer is paying for, how much he owes, and when payment is due. If there’s a discount for fast payment, make that clear, including a calculation of the dollars and cents the customer can save. Don’t forget to include the customer’s purchase order number or contract information.

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Installment billing protects you

Posted on April 20, 2012 by Bruce Bloom

If you’re doing a job over an extended time period, as opposed to an all-at-once sale, seriously consider billing your customer in installments. If there are going to be collection problems, you don’t want to wait till you’ve delivered the whole job to find out you’re going to have to fight for your money. In many industries,  jobs are normally billed “a third, a third, and a third.” That is, a third of the agreed upon price in advance, a third at some midway point, and a third upon completion. Don’t begin the job until you have the first third in your pocket. and don’t finish the job until you get payment for the second third. This pay-as-you-go billing helps save you from cash flow problems, and restrains your customer from playing the game on your money.

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Creative destruction: the cost of progress

Posted on April 11, 2012 by Bruce Bloom

“Creative destruction” means that new technologies render existing products obsolete. If you don’t engage in creative destruction, your competitors will, ultimately shrinking or destroying the markets for your existing products.

Creative destruction comes at a cost. Sometimes your workers can’t handle the new technologies, and must be replaced. Often the long-term benefits of new technologies come at the expense of the short-term profits from existing products.

However you choose to deal with creative destruction, you can’t ignore it. It is inevitable in many businesses. To remain strong, a company must manage change successfully.

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