Unfortunately, the new rules are mandatory and failure to act will result in penalties.  It is therefore important that you are aware of the changes  and the timetables for implementation.  The scheme is operative from 2012 and will involve all employees by 2016.  There is no doubt that this scheme will add an extra financial burden on your business.

At the Business Clinic we have made an in depth study of what the new scheme involves and how it will affect our clients and other employers.  We would be happy to discuss this with you and how we can assist you in implementing the Scheme when necessary and how to administer it.  By the time the first Employers become liable to contract we will have systems in place to manage the payroll implications and administer schemes for you.

Whilst for many smaller employees the deadlines may not be imminent, awareness of the compliance and the costs to your business should be understood as soon as possible in order to prepare yourselves for it.

If you want to know more, please do not hesitate to contact our payroll resources department  at anytime and we can arrange a meeting to discuss the matter further.

Make sure you automatically follow up on unpaid invoices on the day after they become due. Don’t be reticent about asking for payment. If done diplomatically in these early stages, it can nip any potential problems in the bud and won’t harm the business relationship.

2. Offer incentives for early payers

Consider making incentives available for the payment of invoices before due date, for example a discount of 1% or 2% for settling the account within 10 days of issue. Just think of the time saved chasing payments.

3. Ensure your invoices are accurate and detailed

The primary reasons given for non-payment relate to simple invoice queries or administrative errors. Make sure the correct amount is invoiced in the first instance and that the invoice is sent to the correct contact at the right address. Finally ensure that it contains all the relevant details and reference numbers.

4. Raise and send out invoices earlier

It goes without saying that the sooner your clients are invoiced, the sooner you will be paid. So make sure your invoicing process is as watertight and as efficient as possible.

5. Use a third party finance provider

If you have significant or increasing amounts of cash tied up in customer invoices that are due, consider outsourcing the payments to a third party finance provider. That way, your clients will have the option of paying in instalments and, crucially, you will receive the funds upfront and so wont have to use up valuable resources on having to chase payments and, of course, by receiving fees in full, the flow of cash coming in through your business’s doors will be given a welcome boost and monthly revenue can be more accurately forecast and managed.

All this may seem obvious but it worth checking your systems. At The Business Clinic we will carry out health checks like this, and more, to ensure that your business is as efficient as it can be.   In the current climate efficiency is as important as productivity.  There is no good making money if you are wasting it.

Why not come and see us to discuss these and other matters, our initial consultation is free and there are no obligations.