Allowing customers to use credit instead of cash is not a bad thing for a small business. It actually helps boost the company’s popularity and increase its number of customers. But too much of something is bad for any small business.
In order to avoid that from happening to you, read on to find out how you can control your small business’s credit.
1. Always know what kind of credit is normal for your type of business. Decide on your credit limits. As much as possible let your customers learn responsibility and competitiveness.
2. Find ways to help your consumers minimize credit risks. You can opt to offer discounts for payments in terms of accepting credit cards, factoring invoices, and others.
3. Always have a clear and detailed copy of all your payment terms. Let all your customers know of these terms and conditions before letting them apply for credit. Also include it in various financial documentations that your small business will utilize.
4. Specify in one of your terms that you have the right to charge interest rates for any late payments in correspondence to the Late Payment of Commercial Debts Act.
If you’re eager to get more advice on how to control your small business credit, visit this page.Posted in info for small businesses