Hi there, Victoria from HBA Encompass, and today we’re talking about managing your debtors. Now debtors are known as debtors or accounts receivable. So they are the bills or the invoices that you issue to your customers that you require payment on. And look, to be honest, the easiest way to manage your debtors is to make it easy for people to pay you. So that means having bank details on the invoice, you may be surprised how many invoices I’ve actually seen lately, the don’t have bank details on it, which is amazing, how they expect to be paid if you don’t know how. The other thing is, if you use Xero, you can actually link payment services up to your Xero. So things like PayPal or Stripe or Eway or Go- cardless. And that means that when someone clicks through to the invoice, they can click on the link and then put their card in and actually get paid. So Stripe takes credit card payments, Paypal takes credit card payments, but Go-cardless actually takes debit card payments. So sometimes it’s worth thinking about the two of them, and linking them together. The other thing that you want to do is to set up debtor reminders. Now I’m talking about Xero here because we love all things Xero. But in Xero, you can actually set up reminders that go out to your customers, and you can set the frequency and the tone of them. So for instance, you could set a reminder two days before your bill is due that says “Hi Victoria. Just a reminder that your invoice for HBA encompass is due in two days. We look forward to receiving your payment and hope you are happy with our services if not get in touch” and then on the day of the payment “Hi Victoria, friendly reminder that your invoice is due today. If you’ve already made payment, please disregard this message.” Then two days after” Hey Victoria looks like we haven’t received your payment yet are there any issues? Give us a call them we can sort it out.” Now you can have up to five of these reminders and you can work out the timing, whether they’re before or after the actual bill is due. So it’s quite easy to manage debtors from that point of view because you can make it easy for people to pay. And you can remind people to pay and look these reminders can get nasty if they need to, the last one could say that if you don’t pay within 48 hours, we’re going to refer you to debt collection. But hopefully it doesn’t get to that. But also if it does go down that process, making sure that you have got processes and procedures as to who’s responsible for following people up and is still making it easy for them to pay. So that’s how to manage your debtors. If you have any questions regarding any Xero or bookkeeping or accounting issues, give the office a call 54 447094 or go to www.hbaencompass.com.au and book an appointment with your accountant.
HBA Managing Debtors
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