All master sales people have a definite sales process. Some are formal selling systems for which they attended classes, purchased training tapes, or had the benefit of sales coaches. Others are self-designed. But whether or not you're aware of it, if you are selling, you've got a system.
In order to always get paid for every sale...and here's what really matters...get paid on time, you need to understand that the "getting paid" process in almost every company is completely different from the "closing the sale" process.
While you are in the sales cycle, whether the cycle for your product or service takes a few hours or a few months, you have got to find out the detailed process within that client's company to pay invoices. Here's why.
In many companies, the accounts payable department routinely holds invoices 90 days before paying them. You need to know that before you agree on the terms of the sale. You've got to make it a condition of the negotiated terms that no matter the company policy, you will be paid within ten days.
If this is the first sale to the company, there is likely to be some sort of vendor approval or vendor set-up process...and it's got to be in place and you need to have your vendor number before you present the invoice.
At some point after you close the sale, you will present the invoice. If you don't know the internal process, you will almost always present the invoice to the person who is your client and approved the purchase of your product or service.
Almost without exception, that is the wrong person to receive your invoice! Here's what you need to do to get paid on time, every sale:
- If your customer has an executive assistant or secretary, sometime during the sales cycle go directly to the admin and say the following: "As you know, I've been working closely with your boss and it looks like we're close to a sale. Assuming that happens, what is the most efficient and effective procedure in your company to get my invoice paid promptly"? Then do exactly what the admin tells you to do.
- If your client does not have an admin, talk to the manager or chief clerk in the accounts payable department. You may have been dealing with the CFO or controller throughout the sales process. But don't ask them. They are usually too far removed from the daily desktop procedures and work flows to know exactly how it works. (They might know how they designed it to work; but things rarely stay implemented as designed.) Ask A/P exactly the same question you would have asked the admin and do as they tell you.
- When it's time to present your invoice, follow the procedure as learned above but add this step. Speak on the telephone to the person who kicks off the process. They may have told you to email the invoice but follow-up with a conversation, "just to be sure my invoice didn't get lost in the spam filter."
- Once you know for sure the process has started, you need to hand over the follow-up to someone in your company who is passionate about getting paid. I'm lucky. I started my business career in 1974 as a bill collector for Household Finance. I haven't been shy about asking to be paid since I was 22. If that's not you, and you're squeamish, there's someone in your company who views getting paid on time as an absolute necessity. Find that person. Put them in charge of getting paid on time.
- If you're a 1-person business, but you're still squeamish, go home and tell your spouse that the client who's late with the invoice is holding on to your house payment. Trust me...you'll have a wire transfer that day or a check delivered overnight.