Getting paid: collection tips for handling slow- or non-paying clients.

How long does it take your customers to pay you? Have you developed a consistent accounts receivable program? How you answer these questions is a strong indicator as to how well you are getting paid. Sending an invoice doesn't always result in getting money owed to you. Successfully collecting from clients is a matter of negotiating terms in advance, separating collection and business functions, and keeping internal accounting systems in order, according to Bilateral Credit Corp., a New York-based commercial collection agency. You can't be timid or lax when managing your receivables. A few late payers can seriously slow down your business.

According to the International Association of Commercial Collectors Inc., billions of dollars in delinquent commercial credit are on the books of businesses worldwide. Collection is a thorny subject because it can require getting tough with the very same customers that keep your business afloat. Many small businesses handle the entire process in-house, either by charging their sales staff with the task of collecting their accounts or by using collection personnel.

Most often, a company will consider turning over a hard-to-collect receivable to a commercial debt collection agency after it has been outstanding for 90 days. In essence, collection agencies try to get the money owed by using a combination of letters and telephone calls. Some will also help their clients pursue legal solutions to collecting a receivable. For information on finding a professional collection service, visit the IACC Website at www.commercialcollector.com or call 952-925-0760.

Monitoring slow-paying accounts and adopting timely billing practices are just two ways you can help unclog your payables. Here are some others:

Offer discounts for invoices paid before the due date. An age-old technique is to give a discount to customers who pay what they owe within a specified time frame, for instance, 5% off a bill paid within 30 days. Of course you may first have to raise your price by 5% in order to avoid gross margin erosion. You can also opt to assess late fees for delinquent clients.

Invoice sooner rather than later. Don't wait until after a shipment is sent, a service is rendered, or an product is delivered to mail the invoice. You might date a bill July 14 although the customer may not receive the goods until July 18 or 19.

Keep detailed, accurate notes on customers. Keeping notes every time you make contact with a customer will help you when you have to make subsequent phone calls (and possibly begin litigation). Good notes will also help you make credit decisions.

Make contact before the bill is due. You can try to facilitate the payment process by calling customers 10 to 15 days before their first invoice is due to express appreciation for their business. Ask if there were any problems and if everything was to their satisfaction. And ask if you can expect their payment by the invoice due date. Follow up on a timely basis. Many people are slow payers. Phone calls and letters can help expedite the process.