Archive | Funding

RSS feed for this section

Guidelines to ensure customers pay on time

Like we all know, having a stable flow of money in your business is always critical to ensure the optimal function of your business. When you offer your customers the debt option, this flow of money in your business might become in jeopardy. Here are some guidelines to make customers pay on time.

Pay on time

 

Receive your payments on time

A good way to ensure that your business will not be affected by giving credit to your customers, is to ensure that you have an effective system in place that monitors the payments of your debtors and also to ensure your customers pay on time.

Invoicing

If you want your customers to pay on time, you will need to ensure that you send the invoices to them on time to ensure that they get a reasonable amount of time to settle their accounts. When there are recurring bills, you can schedule them to go out monthly, on a certain date. This will allow some of the customers to even set up automatic payments to your business. Once you have this in place, you will find that more of your debtors will pay on time.

Offer incentives

You can consider offering incentives to customers for paying early. This will motivate them to pay early in order to receive something in turn for paying on time. Giving incentives will give these debtors reasons to act quickly and in time to pay their debt. These incentives can be anything from discounts or a free sample.

Another thing that can motivate debtors to pay on time is by adding interest to their accounts if they make their payments to late. When you do this, they will try and pay on time in order to avoid paying extra. This has proven to be a very effective method to motivate debtors to pay.

Keep a paper trail

It is always a good idea to keep track of all the paperwork concerning your debtors. You should keep invoices, documents and bills. If it is possible, you can also make an online backup. This will make for easy reference when there is something suspected. This can also serve as a security measure for your business and customers will feel more secure doing business with you when they know you can be trusted with all the paperwork.

Establish an open line of communication

In some cases, customers just simply did not pay, because they did not know that they were due to make a payment. For this reason, it can be a good idea to phone or email these customers to remind them. This will not happen if you send monthly statements to customers.

People will also be more willing to come and talk to you if they are struggling to make their payments. You will be able to know about and understand their situation better. Therefore, you will be able to adjust the payment terms and be able to adjust your cash flow accordingly.

Debt can be a very troubling thing for certain people. Therefore, you will need to do sufficient background checks to ensure that the debtors will be able to pay. When you stick to these simple methods, you will be able to improve the rate at which your debtors pay you back.

FIND MORE ARTICLES ON OUR BLOG – click here

 

An entrepreneurial center for South Africa

Understanding all the business jargon and necessary compliance when starting a business can easily become overwhelming. There is now help from the Entrepreneurial Center of South Africa. 

entrepreneurial center

This no longer has to be a problem for new entrepreneurs. South Africa has launched an Entrepreneurial Growth Center. This center will support new entrepreneurs to ultimately start and run their own businesses successfully.  This center was launched by the risk finance company for small and medium enterprises, Business Partners Limited.

The Entrepreneurial Center is located in Johannesburg. Luckily, you will not have to travel all the ways to Johannesburg to share in this opportunity. They are also offering assistance to entrepreneurs through email, their call center and the national platform for professionals, LinkedIn. Entrepreneurs will have access to business mentors that have been trained, offering educational information.

The main purpose of the Entrepreneurial Growth Center is to provide support and assistance to all entrepreneurs, especially new entrepreneurs, in South Africa. They will give guidance and business tips to entrepreneurs that are looking to learn and extend their business knowledge.

Business Partners Limited did extensive research to establish with which aspects entrepreneurs struggle the most with. When they have compiled all the information they collected, they came to the conclusion that funding for their ideas are the most challenging part. It was also established that entrepreneurs are most likely to need guidance in the first few years after they started a business. You can apply for a government grant here.

In the first few years of doing business, the business is most vulnerable. At this time the entrepreneur will have to establish the business in the market and will also have to start to build a reputation for their business. Research has also shown that these few years of doing business is the time where the highest rate of business failures has been recorded.

The Entrepreneurial Center has therefore committed to help new entrepreneurs and business in their vulnerable years, to give them the best possible guidance to minimize their chances to fail. This will ensure that the entrepreneurs have the knowledge to sustain their own businesses.

Other parts that entrepreneurs struggle with are doing market research. Doing market research will ensure that you supply products that the customers are looking for. It will also help you to identify your competitors and will help you to establish market related prices. Other aspects that they also give attention to are things like BEE compliance, assistance with cash flow management and VAT.

companyservices-pricelist

One of the more important aspects of running a successful business is to comply with the different laws that have an impact on the business. These laws will differ depending on the type of business that the entrepreneur started. One of the general laws that have an effect on any business is the Labour Law. This law governs how employees of a business are to be treated. Not all new businesses have a lot of employees, but this is a very important law to take note of in the future. Employees are the biggest asset of any business and therefor it is very important to know the law and knowing how to apply it. The Entrepreneurial Center also has business mentors that can help with these laws, especially ones that have a direct and a fairly large impact on the business.

You can easily contact The Entrepreneurial Center on 086 SMEFIN (0861 763 346) or email them at enquiries@businesspartners.co.za

The Entrepreneurial Center is a very good initiative from Business Partners Limited. Giving entrepreneurs the necessary information to run their own businesses will also have a positive effect on South Africa’s economy. This Center will enable entrepreneurs to start and run their businesses successfully; to their full potential.

FIND MORE ARTICLES ON OUR BLOG – click here

Business Loan – avoid paying extra

While chasing your dream to open your own business, you might need to take out a business loan somewhere along the line. There are a lot of different types of loans to choose from but the real struggle comes when repaying the business loan. The trick is to avoid overpaying for your business loan.

business loans

Entrepreneurs might seem to be well educated about how to determine the total costs of starting a business. This is the truth, but not that many entrepreneurs know how to get the best business loan for their needs.

Financial advisers recommend that the total amount of the business loan should be repayable in six years. This will ensure that you do not put yourself at risk for possible bad debt. Furthermore, they advise that your monthly repayment should not exceed 15 percent of your monthly income. This means that the amount you apply for, should correspond with your income.

Before entering the bank you chose, be sure to know your credit score set by the NCR. Also, be sure to know about the terms of the interest and inflation rates that the bank of your choice has. Try and settle an agreement for a fixed term interest rate. This will allow you to take certain measures to make provision for possible fluctuation in the interest rate.

Be sure to read the entire contract before signing it. Also, be sure that you understand every detail and if not, ask for assistance to understand certain aspects of the contract. Insure that you do not sign for any extras like credit insurance (if you did not ask for it) or any other service that you did not ask for. Ask the bank to amend the contract before signing it. It is better to wait a bit longer for the right contract than to sit with more debt than you bargained for.

If you are able to consult a financial advisor beforehand, it will be to your advantage. It is advisable that the financial adviser you consult, should not be a part of the bank you are looking to apply at. The best will be if the financial adviser is an independent person, without ties to any financial institution.

Try to avoid loaning money from a loan shark. Always opt to get a business loan from a well known bank or a government grant. It will give you the peace of mind if you know what you are getting into. The terms of an agreement with a bank will most of the time correlate better than other credit providers with the acts that protects you as a customer.

Once the  loan has been approved there is other information to take into consideration as well. Always remember to pay your monthly balance on time. This will ensure that you do not have to pay any extra fees.

A smart move to make when your business is up and running, is to make monthly payments larger, if your salary allows it. You should never stray away from paying more or less than the above mentioned 15 percent of your salary. When paying a bit extra a month, you will be able to pay off your business loan faster. This will result in you being debt free and automatically putting your business in a better place.

The main issue with overpaying for your business loan, lies in the choices you make. You have to choose the correct bank that suits your needs without charging you too much. You should also choose smart when it comes to extras that the financial institution wants to offer you. The best will be just to take the business loan and nothing extra. And to always ensure that you pay your monthly installments on time.

Always keep an open mind when entering a business loan. Remember that the financial institution is also just a business that needs to make money to keep their doors open. At the end of the day, all that is left is to ask if you are unsure.

Non-repayable Government Grants available on this website.

FIND MORE ARTICLES ON OUR BLOG – click here