At the start of any business venture, the future often looks bright and shiny. Many people at this point do not like to think about the challenges of running an enterprise such as account receivables, firing employees, dealing with broken customer relationships, and more. As a result, they do not prepare in advance. Cannabis companies are no exception, always waiting until disaster strikes to take action.
However, there is no telling what the future will throw at you. If you are in the marijuana business, you know just how uncertain and volatile the business is. Your customers may fail to pay their bills and cause trouble for you. What do you do when this happens? This is where optimization of past due collections comes in. Here are 5 creative ways to go about this.
- Bill Your Customers Right
One of the best and most important tips of optimizing your past-due cannabis and CBD receivables is to ensure your invoicing is right. For starters, your invoices should capture all the necessary information including the number of items sold, payment terms, and/or hours billed. The invoice should also contain the correct contact details to ensure fast deliveries. A clear invoice will rule out any chance of follow-up questions or disputes. Finally, be sure to send the invoices as soon as possible to inspire your customers to make early payments.
- Offer Flexible Payment Plans
When your past-due cannabis customer informs you of some cash flow problems of their own, consider offering them a flexible payment plan for the past-due amount. By doing this, you secure your relationship with the client and get your cash back, albeit at a much slower rate. If you go this route, be sure to put it in writing and have both you and the client sign it.
- Exhaust All Your Communication Channels
The most polite way to send reminder is through letters and emails. But, if your past-due client would not respond through these means, proceed to make a courtesy call. While at it, maintain your professionalism and simply ask them when they intend to make their payment and ask if there is any challenge they are facing with matters finance. As the situation carries on, be firm with your communications but never issue any threats at any point.
- Keep A Record Of Customer Interactions
Another ingenious way to optimization your collections on account receivables is to record all the commitments and promises of your customers. These include dates and modes of payments. This will help you remind them of the commitment made during your next courtesy call.
- Ask For Professional Help
Many cannabis companies do not like the idea of bringing in a third-party to handle their collections on past-due receivables. This is because doing this might put a strain on their relationship with their clients. However, hiring a pro can quicken the process. Experts have effective strategies for collecting debts. If all other methods do not bear results, consider going this direction.
There you have it; the short of it is that you need to optimize your cannabis and CBD collections if you want to convert sales into revenue. Lucky for you, this is easier than it seems. Use the above tips to the best of your ability and experience a transformation in your collection process.