Money in the Bank

Getting paid is one of the most important, if not the most important, aspects of ensuring business continuity. Not surprisingly, it’s also a step that many entrepreneurs let slip because few people want to deal with overdue payables. We’re talking about collecting the cash.

Dee Bowden is a business-to-business collections expert and author of “Collect the Cash.” Her company BCS Solutions works with businesses to establish good payment processes. Bowden has seen many small businesses suffer from lost revenue because they don’t collect on outstanding invoices. Small business owners generally do a good job of learning about sales, marketing, and billing, she says, but they don’t take those processes through to the final conclusion: payment. “You can’t just provide a service with an expectation that you’ll be paid,” she says. “The sale is not complete until the money is in the bank.”

Years ago, Bowden worked in collections for a small tech firm that had more than $6 million in outstanding receivables. During the process of collecting those funds—which took her just 60 days—she established a four-part cash collection process that can be applied to any small business seeking to collect revenue that’s due them.


Any collection process begins with fundamental problem solving, which starts by asking yourself the right questions. Did you provide a proper invoice? Did you provide it to the right person? Did you follow up? Are there circumstances that are preventing or delaying the payment? How can you work with the client to resolve the issue?

Don’t wait until there’s a real problem to start problem solving. Instead, continually evaluate your sales and billing processes. Are there hiccups in the process, warning signs that could signal problems down the road? Address those immediately. Find ways to fix things instead of just moving along and hoping things get sorted out in the end.


Good customer service goes above and beyond what clients expect. When there’s a problem, good customer service admits to that problem and resolves to come up with a solution. Make sure clients feel heard when they express concerns, and if you’re at fault, apologize. When people experience good customer service, they breathe easy because they feel taken care of.

Why is this important to collections? Because it opens up the lines of communication. You’re in a better position to address a problem when a client feels comfortable talking to you about it. Follow-up is critical in collections, and with open communication and an established relationship, follow-up runs smoother.


People have a choice where they spend their money and their time, points out Bowden. Expressing gratitude for their choice to spend money with you and for their actual payment acknowledges that their decision is meaningful to you. “Always thank the person who pays the invoice or helps you receive payment,” says Bowden. “Acknowledge their help. When you stop to thank people, it sets you apart.” It also creates goodwill for expediting your payment and future collections.


“In business and in life, we have to build relationships,” says Bowden. “No business transaction takes place without a relationship.” Relationship building begins very simply: Ask questions.

Inquire about your client’s needs and concerns, and then put together customized solutions. Show that you’re listening. Pay attention to the details and help people feel seen and understood.

When you build a good relationship with a client, collecting a payment is much easier. Ideally, that relationship will help you and the client understand each other. It will help foster an agreement about what you’re providing and what they’re paying. And it will help prevent missed payments in the first place.


Bowden points out that entrepreneurs, especially those in the creative professions, typically go into business because they’re inspired to follow their passion. They’re focused on doing what they love and providing good service. They also spend a tremendous amount of time and energy securing business and building a client base. As a reward for these efforts, they assume clients will be appreciative and pay for what they’ve received. When they don’t, many entrepreneurs are afraid to ask for money because they think their clients will see them in a different light or won’t give them additional business. They don’t want to rock the boat.

But if you’re not getting paid, that boat is already sinking. “It’s really important to show the same confidence in asking for money as you were in asking for the business in the first place,” says Bowden. If a client values you, they shouldn’t have a problem paying for your artistry. If they don’t, then you don’t want to do business with them anyway, and it’s better to discover that early in the relationship.

Think about when you go into a store to buy something. Do you expect to walk out with the product without paying for it? It’s no different for service-based businesses. Clients don’t have a realistic expectation that they’re going to walk away with a finished product without paying for it. Make sure you receive payment before delivering the final product.

The full process is sale, contract, invoicing, payment. If you’re missing any part of that, then your most essential business process is broken.


“To begin, people just need to get comfortable asking for the payment,” says Bowden. From there, Bowden follows a simple procedure to follow up and increase the likelihood of payment.

  • Ask why. If you haven’t been paid, ask your client about it. For example, “Is there anything that’s come up that is preventing you from paying me?”
  • Show understanding. Things happen, mistakes are made. Demonstrate understanding and then problem solve.
  • Remind them. Remind them that they have an obligation to pay you. Remind them of previous promises made, tell them that you want to continue to work with them, and let them know you want to resolve this amicably.
  • Be flexible. If they need to change the payment plan structure, offer alternatives such as partial payments or a payment plan. “Some money is better than no money,” says Bowden. “And nothing is worse than getting ghosted.”

Of course, the best way to do collections is to avoid going to collections in the first place. Do the work up front to avoid having nonpayment problems down the road. Start with the fundamental practice of never delivering the final product until payment has been received. For projects that involve multiple or incremental payments, effective tracking is important. You should always know where you are in a project, what the payment status is, and what the next milestones are. If things get off track, address them immediately before proceeding with the work.

“If you learn to manage all of this on the front end, you can avoid problems down the road, make more profits, and have a more successful business,” says Bowden.

Jeff Kent is the editor-at-large.