We are all easily driven by the promise of success. The closer we get to our goals, the easier it gets to lose focus and become less rational. Is an example needed to prove this thesis? Easy-peasy. Let’s consider closing deals for any business. Don’t we start celebrating once we get a signature on the contract? The reality is that at this stage we are sometimes as far away from success as we were when the lead was created.

THE ART OF WINNING

First things first, let’s be honest with ourselves. We all have been there.

The deal signed, handshakes made, smiles shared and yes, we are heading back to the office with some triumphant music playing in our head. Yeap, we are the champions!

We feel like the world is ours or at least like we have a big slice of what the world has to offer. Nice, isn’t it?

We announce to everyone in the company how successful we have been with the latest deal, we collect the praise from the CEO, the signed contract is placed on his or her desk like a Holly Grail and then… Well, then it starts for real.

CRAFTING THE ART OF LOSING

Two weeks after the first invoice has been issued, we start to fill a little grumpy. There’s still no money, the customer now owes us.

One more week and the Financial Director starts to look at you with a raised eyebrow.

Less than 7 days later we have to explain to the boss, what has gone so terribly wrong and why we have ended up like this. We now have a problematic signed contract, which becomes more like just a letter from the past rather than a binding document that will yield some kind of payment.

THE STATS SAY – IT CAN HAPPEN TO YOU! THE REALITY SAYS – IT WILL!

Stay right there! We do not want to continue any longer, this is a sad and repetitive story. When a US-based Head of Financial Control, where I used to work, kept on examining all the salespeople from Europe to find out why there were such tremendous delays in payments from their clients, she stopped in the middle of talking and asked: ‘Is it a common practice there not to pay until the due date?’.

Well, I would love to say, God, no! This is not the way it works. I think we have just been a little unlucky by signing some of the late payers e.g. a few black sheep of the business world, but the truth is very different. More and more clients of yours will avoid paying on time. This is not a practice that makes people ashamed any more. It is rather a serious business plan on how to conduct payments on the customers’ side. They know that going to court to collect the money that’s owed, is demanding and time-consuming exercise that always ends badly from a PR point of view, so they grab the line and try to push it to the absolute limit.

A two-week delay? Why not make it four weeks? And if it’s already four, how about making it six? C’mon, it’s so easy and tempting. It’s always better to have money in your pocket and not in someone else’s.

A SOLUTION? GRAB THIS ONE

While business becomes more and more competitive, the lack of money flowing freely can end up with a great company drowning. This could have been avoided and heads could have been kept above water if only just two or three invoices more were paid on the due dates.

In the UK, 27% of invoices are not paid on time. This means that every fourth invoice issued will not result in the expected bank transfer, while the service or products have been delivered and costs have been created. Ouch!

Ok, smarty pants! What’s your solution then? – you might ask. Hold my (English) tea and let me tell you:

  • Stop believing that a deal won = a signed contract
  • From now on a deal can only be considered won after the first invoice has been paid (sad but true),
  • Do not commit to delivering services until you get the first part of any remuneration that’s due
  • All you can lose now is your time, but you will avoid losing money and resources on projects that do not bear fruit
  • Be positive – it is not only your business that has been affected by untrustworthy payers
  • It’s only us who can change this business culture and create a better environment for everyone.

So start your journey today by checking if there are any rotting invoices on your desk.

 

 

Want to learn more from STATSCORE experiences and good practices? Contact Customer Success Team via the Livechat at www.statscore.com or reach to us via email at cst@statscore.com.