Back to Business After Summer: What Happened to Your Cashflow While You Were Away?

I’ve just come back from a week off, where for the first time since setting up this business - I properly switched off.

I spent time with my boys, visited my family up north and, apart from keeping a bit of a presence on LinkedIn, INcharge took a back seat for the week.

That’s exactly what time off should be, right?

But it did get me thinking about what happens in other businesses when the person responsible for invoicing and credit control goes away.

Because unfortunately, your cashflow doesn’t take a summer holiday.

What happened while you were away?

You know what it’s like when you come back from holiday.

There are emails to catch up on, calls to return, client work waiting and probably a few things that have suddenly become urgent while you’ve been away.

Credit control can very easily end up somewhere near the bottom of that list.

But if nobody was looking after it while you were away, you may now have invoices that are two weeks further overdue than they were when you left.

There could be customers who promised a payment that hasn’t arrived, queries that haven’t been dealt with or work that was completed before you went away that still hasn’t been invoiced.

And all of that has an impact on when you actually get paid.

If you completed a job before your holiday but didn’t raise the invoice, for example, the clock on your payment terms hasn’t even started yet.

If a customer queried an invoice while you were away and nobody responded, they may well have put the whole invoice to one side.

Or perhaps the money has arrived, but nobody has reconciled it yet.

I’ve seen first hand how easily that one can cause problems. A customer pays several invoices, disputes part of another and doesn’t send a remittance advice. The money is sitting in the bank, but it isn’t clear exactly what they've paid.

If that isn’t sorted out properly, you can end up chasing an invoice that has already been paid while the genuinely outstanding one gets older.

Not exactly the conversation you want to have with a customer.

It’s why I don’t see credit control as simply chasing invoices

Everything is connected.

Invoicing → Queries → Credit control → Payment → Reconciliation

Raise the invoice late and payment starts late.

Leave a query unresolved and payment gets held up.

Don’t follow up and your invoice can very easily sit at the bottom of somebody else’s pile.

And if you don’t reconcile the payment properly when it arrives, you can end up chasing from information that isn't accurate.

This is why INcharge looks after the whole process rather than simply sending a few chasing emails once an invoice is overdue.

It’s about knowing what should have been invoiced, what is due, what is overdue, what is stopping something from being paid and, eventually, making sure the money that lands in the bank is allocated correctly.

Taking time off shouldn’t mean everything stops

I don’t think any business owner should be sitting on holiday wondering whether a customer has paid an invoice.

And I definitely don’t think the answer is not taking the holiday in the first place.

I was able to take my week off and enjoy it. That's how it should be.

The answer is making sure there is a process in place so that getting paid doesn't depend on you finding time to deal with it.

September is a good opportunity to look at that.

Most people are back from their summer holidays, schools are going back and business starts to feel a bit more normal again.

So before the final few months of the year disappear (because we all know how quickly that happens!) have a proper look at your accounts.

What’s overdue?

Is there anything you haven’t invoiced?

Are you waiting for customers to come back to you about queries?

Did anybody promise to pay before you went away and then not actually do it?

And does everything showing as paid genuinely match what's arrived in your bank?

You might find everything is exactly where it should be.

But if you find yourself staring at a list thinking “I really need to get on top of this”, then perhaps the more important question is whether you actually have the time to keep on top of it once business gets busy again.

If you want to keep managing it yourself but need a better process to follow, my Credit Control Foundations Kit was created for exactly that.

Alternatively, we can help.

INcharge Services manages the whole process from raising the invoice right through to reconciling the payment when it arrives, including dealing with queries and following up with customers in between.

If you'd rather hand the whole thing over than add credit control to your September to-do list, take a look at how INcharge can help or get in touch for a chat.

So taking a week off doesn't have to mean taking a week off getting paid.