It’s incredibly important for recruitment agencies to be paid on time and within said terms. Even with Brexit looming and financial needs impossible to predict, many recruitment agencies are having issues with clients making payment for their services rendered.
Unfortunately, some clients will try every trick in the book to keep their cash in their bank account for as long as they possibly can. Good news is, TBOS has had plenty of experience with shifty clients so we have put together 8 effective credit control tips for recruitment agencies to use when chasing payment for their services.
These 8 steps will help to ensure your agency payment terms are met consistently on time, every time…
1. FIND OUT PAYMENT INFORMATION DIRECTLY FROM THE CLIENT’S ACCOUNT DEPARTMENT
Finding out the client’s payment processes and procedures before raising the first invoice, can ensure invoice correctly from the very beginning and throughout. This will avoid having to re-do invoices at a later date as per the client’s specifications.
2. ENABLE DELIVERY REPORTS & READ RECEIPTS ON INVOICE EMAILS
When sending invoices by email, it’s important to track the status of the delivery. This will prevent problematic excuses that emails have not been received.
3. ASK FOR CONFIRMATION OF RECEIPT
You should always request a confirmation of receipt from your client when sending your invoice over email. This will confirm the invoices are correct and that they have been factored into their next payment run. This will also raise any issues with the invoice early on, if there is an error it can be corrected before the said payment date.
4. CALL THE ACCOUNTS TEAM A WEEK BEFORE THE PAYMENT IS DUE
By calling the accounts team a week before payment, this will confirm that your invoice is included in your clients next payment run. You may also receive a remittance of payment if you have already had the invoice confirmed.
5. IF YOU CAN’T GET THROUGH TO ACCOUNTS, GO TO MAIN SWITCHBOARD
It can often be difficult to reach specific departments like the accounts team. We recommend going through to the main company switchboard and then being transferred to the accounts department. If you’re transferred to a voicemail or an automated line, call the switchboard back and ask to speak with someone else in accounts, until you get through to a person.
6. KEEP THE PRESSURE ON THE ACCOUNTS TEAM
It’s much more difficult to delay paying someone who is putting the pressure on. If you’re not firm and consistent with chasing payments, they will become more relaxed on making payment for your services.
7. DON’T RELY ON SUBSTANDARD CREDIT CONTROL
Many invoice finance companies will claim to chase credits for you but they will often not verify an invoice until it is already overdue. Be sure to ask them about their ‘Dunning Cycle’, you may be surprised to find out how lax it really is.
8. DON’T BE AFRAID TO SEND A WARNING NOTICE
If a client fails to make a payment within your specified time frame or is being unresponsive, send a seven-day-warning notice explaining that they have seven days to make the overdue payment before you begin to seek legal action. Don’t worry about damaging client relationships, as the client will be fully aware that they are in breach of the agreed contract. If they are not aware, the warning letter serves that purpose, which is why it’s best not to seek legal action immediately.
HOW TBOS CAN HELP
TBOS has over 10 years’ experience in running the complete back-office and accounts processes for many recruitment agencies. Looking after our clients’ credit control needs is only a small part of this service which our specialist team carry out very effectively…
‘Our average debtor days moved from 80 days to 30 days within a few months of joining TBOS. Exceptional work by all concerned.’
Read the full testimonial from
If you are having issues with your agency’s cash-flow and credit control requirements, please do not hesitate to call TBOS to see how we can help your agency get back on the right track.
