It’s almost Independence Day, and while we are certainly all thinking about barbecues and fireworks, it can also be a time to work on those late paying customers who are clogging up your accounts receivables.

We all have them – customers that both continue to give new business but also continue to owe money. We afford these customers more credit because they are “good customers” who continue to use our services and buy our product.

There are ways, however, to get these customers to pay more quickly. We assume that the payment arrangements for these customers are sufficiently documented, since the very best customer can become a nightmare overnight, and every payment arrangement must be documented.

Consider offering a discount for cash payments. Try a discount for early payment. Special discounts for only your best repeat customers, it might actually make them even more willing to give you new business.

Match the payment plans you offer to your cash flow stream. We have one customer who moved up her “due by” date and made all invoices payable in 14 days. Our customer is in a labor intensive business with a weekly payroll, and found that she was no longer able to let invoices go for 30 days, so this approach worked for her.

Make it easy for customers to pay you by accepting credit card payments and using an online payment portal.

Don’t be afraid to make “cash calls” – gentle reminder phone calls to let customers know that you expect to be paid.

Most importantly, stay on top of your accounts receivables. Review them at least every 30 days. With a little love and attention, you will see your aging receivables begin to shrink and have more cash to run your business.

Have a happy and safe 4th!