If you are looking to free up time to better serve your clients, hiring an invoice factoring company can help with both cash flow issues and saving you time from collecting on money owed. Consider these positive outcomes that could help you focus on improving your customer relationships.
Being Upfront Builds Trust
When you decide to start using an invoice financing company, it’s best to let your customers know. Be upfront in candid conversations with current customers or a potential client. Inform them you’re hiring a factoring company so you can maintain a positive cash flow, especially if the clients are known to be slow with payments.
Especially in B2B relationships, this touches on some of the same issues your customers may also be running into as fellow business owners. Having the cash flow to continue operating and even reinvest is something many experience. And not all clients are quick about paying upon project’s completion, which can make things difficult for you, especially if you’re a smaller company.
Both you and your client have a mutual vested interest in a project being a success. If your customers view you as partners and vice versa, this only solidifies that very dynamic. Both parties see how vital their relationship is to the success of both companies goals.
Positioning is also crucial here. Consider this: When you tell them you’ve chosen to use an invoice company, explain it is so you can spend more time helping clients and reinvest towards their specific business goals.
Opens Up New Possibilities to Gain Loyalty
If you offer net terms to customers, they can effectively pay for your goods or services 30 to 90 days later instead of upfront. From your perspective, taking on additional projects likely leads to a larger overhead that you wouldn’t see payment on traditionally until months later in some cases. Again, hurting your cash flow to the point even qualifying for loans is more difficult.
Through an invoice financing company, you still receive 70 to 90 percent of all invoice payments upon billing which opens up a way to gain a competitive edge and close more sales. Plus customers may appreciate how flexible your business is with payment terms compared to others who require all money in advance.
More Time for Customer Outreach
See what your customers need from you instead of dedicating hours to reviewing invoicing and collections. Getting paid on day one and sourcing your billing also frees up time so you can explore the good kind of scope creep; the sort where agreeing upon additional work from the client fits into your operations and gives you more revenue.
One of the most powerful questions you can ask customers for good scope creep is, “When it comes to x [x being whatever your customer’s goal is], what’s your single biggest challenge?”
You can collect this by email or phone, or if you are looking to prospect previous clients, add it into your inbound marketing funnel.
Surveying or asking your customers what would help improve your customer experience or their experience using your product or service can provide all sorts of valuable insights as you look to grow.
Ryan Levesque’s book “Ask,” named Inc. Magazine’s #1 Must-Read Marketing book for 2015, explores taking the guessing game out of figuring out what your customers want and segmenting your customers into larger buckets to see what each of those groups need.
Reinvest to Improve Customer Experience
Putting the money toward sales reps may seem like the obvious choice for continued growth. Consider putting those funds towards product management, too.
Product management can entail:
- Reviewing the quality of your services and also the quality of suppliers in the case of physical products
- Adding enhancements to your service from customer feedback collected
- Tweaking or even revamping your company’s marketing messages to resonate with your target market
- Developing or re-evaluating product life cycle
Or reinvest on scalable services or features that enhance your customer experience. Have a product or service that requires education as part of the onboarding process? Add a self-service library or sequence of tutorial emails customers may reference to get started and easily browse.
For a B2B service that requires more hands-on help like custom site migrations, think about adding front of line support. Free up time for your developers with processes in place to get information you typically need to migrate or troubleshoot more common issues.