One thing that has helped our cash flow tremendously is the fact that we bill and get paid in advance. It took a long time to get to this point in our business but once we made the shift we noticed immediate benefits.
Many service Industries bill in arrears, meaning they bill after work has been completed. Contractors will often take a deposit and payments after completing milestones, and their final bill will come sometime after all work is complete. Then, if they have payment terms of 14 days, 30 days, 60 days, or even 90, they often have to wait weeks, if not months, to get paid.
Most of our clients are on auto-pay, meaning we draft their account or charge their credit card automatically every month. There are a few that pay us by check, but if they do our payment terms are seven days. Sometimes prospects will question that, but overall it works for us and helps us get paid faster.
Erik J. Olson is an award-winning digital marketer & entrepreneur. The Founder & CEO of Array Digital, he is also the host of the Journey to $100 Million Flash Briefing and daily podcast, and the organizer of the Marketers Anonymous monthly meetups.
Kevin Daisey is an award-winning digital marketer & entrepreneur. He started his first company when he was just 23, and is the Founder & CMO of Array Digital. Kevin is also the co-host of the Journey to $100 Million Flash Briefing and daily podcast, and the co-organizer of the Marketers Anonymous monthly meetups.
For more information on the show, and to check out past episodes, go to journeyto100million.com!