Debt is a problem that will plague any field service company at some point. Many people think of debts as a Carillion-type situation, where a commercial client goes under and pulls many other, smaller companies with them. They rarely stop to think about small debts and take these as a customary aspect of doing business.
So today we’ll try to dispel the myth that there’s nothing you can do about this. We’ve enlisted the help of Anastasia Vinnik, a payment expert at SumUp, to tell us a few things about alleviating these pesky small debts and improving your cash flow. She agreed to give us a hand with some of our tips:
Click to skip to what matters most to you:
1. Preparation is key.
2. Deferred payments.
3. Get an instant payment solution.
4. That instant payment solution? Make sure it comes with analytics too!
5. Invoice properly.
Prevention is better than cure, or so the saying goes. Regardless of what system you’re using, your business strategy, or your CRM, the first step all businesses should take is to screen their customers. A field service company is no exception. A plumbing business should screen their customers just as much as an electrical company or an HVAC one.
This is especially important if you’re doing a lot of commercial work but applies to larger domestic jobs too. Get familiar with credit checks and financial statements before you sign a contract and you’ll save yourself a lot of trouble in the future.
A deferred payment refers to the practice of putting a block on a set amount of money on a customer’s card. You can do it both for domestic and commercial work. You’re probably familiar with it if you’ve ever shopped on Amazon or booked a hotel.
Many field service companies are apprehensive about it since they feel like it will scare customers away. But if it didn’t scare them away from booking holidays, then why would it now?
Taking deferred payments before starting work on a job is simply a good business practice. You always choose on a customer-by-customer basis if you don’t want to offend a customer you’ve known for years and trust to pay on time although we’d still recommend doing this sparingly and for small jobs only.
If you want to reduce small debts (and large debts too!), this is a great way since you can defer the full amount on lower-priced jobs or a certain percentage on higher ones. After the work is done and an invoice is raised, the engineer can take payment on the spot but that’s only if you…
Have you ever been to a market, packing your organic groceries away when you realized you don’t have any cash on you? That’s most people’s experience these days. Except many stallowners have caught on so instead of having you run to the nearest cash machine or start unpacking your groceries, they pull out an instant payment device.
According to SumUp payment expert, Anastasia Vinnik, this instantly transforms a negative customer experience into a positive one and goes further than you think in making customers loyal. Not to mention the cash flow benefits your business gains from having instant money in the account rather than waiting for customers to mail cheques or for banks to approve credit card transactions. This way, you’ll overcome your small debts problem in no time!
That instant payment device? It was probably a SumUp Air Reader. Many businesses have chosen SumUp due to the benefits the device comes with, many of which are designed to work for small-to-medium companies looking to grow and offer an experience comparable to that of big name competitors. Some of these are:
- Simple pay-as-you-go pricing without fixed costs meaning that you don’t have to impose a minimum transaction value on your customers in order to offset charges
- A 5-minute registration process with no long-term contract; simply order your device (arrives in 2-5 business days) and start offering instant payment!
- Sleek, easy to use terminal that engineers can connect to their Commusoft phone app and carry in their pocket.
- Fully PCI compliant meaning that your business doesn’t put customers’ details at risk and protects them from fraudulent activity.
These put any field service company in the big leagues!
The great this about a payment solution is that since they’re fully digital, they come with analytics as well. Everything worth doing is worth measuring, after all. When it comes to payments, things can easily get lost in the hassle, especially when your engineers are busy and running from one job site to another. Having a digital papertrail means that you always know who did what and if someone forgot to take payments after the work was done.
According to Anastasia Vinnik, SumUp offers a Dashboard where business managers can check the payment status, get an overview of total sales revenue and, of course, generate various payout reports based on their needs. This means that you can run regular audits on how well your team is doing and how much return-on-investment your instant payment solution has generated. You’ll find that small debts are significantly reduced if you just make it easier for people to pay!
An often overlooked benefit of having an instant payment device that integrates with your software is that invoicing is not a hassle anymore. Many times, with cash or cheques, your engineers forget to produce an invoice and it’s down to the office staff to manage and match the bill to the payment. However, it’s very easy to lose track of paperwork and either leave the customer uninvoiced (which puts you in a risky legal position) or forget about the payment completely.
Many small debts come from the fact that field service companies don’t manage their invoices properly or are simply overwhelmed by the sheer volume if they’re not using a digital system. With the way Commusoft integrates SumUp, this becomes a non-issue. The engineer can’t take payment without associating an invoice beforehand. This way, you have a digital trail where every party is accounted for and your data stays organised.
If you’re going digital, you need to go all the way. Having an intelligent scheduling system, an online booking portal, and a sleek website will delight your customers but will also create an expectation that the experience will remain digital throughout. You can’t have people hire you like it’s the 21st century and then pay like it’s still the 19th, right? You need to take card payments or accept the fact that you’re not providing the best experience you could. At the end of the day, what type of business do you want to run?