by Aisha Jones-Scheffel,
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UNITED STATES, Jan 28 — Ever wonder why there is check advance business on every corner? Well, in our fast-paced society everything is speeding up. And guess what, we also want to get paid faster too. We want tomorrow's paycheck yesterday. So @TEOTD, increase your bank account balance by increasing how fast you get paid
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ver wonder why there is check advance business on every corner? Well, in our fast-paced society everything is speeding up. And guess what, we also want to get paid faster too. We want tomorrow's paycheck yesterday. There are several business-savvy ways you could speed up how you get paid. This article will discuss four ways to get paid faster
Prepaid
The absolute best way to cash flowing into your bank account is to get people to pay for products or services before they are actually delivered. To do this you typically need to have what sales closing coach extraordinaire, Lisa Sasevich, would call an "irresistible offer." For example, you're a dentist and you want to start offering a teeth-whitening service that is going to require new equipment and supplies. Although you have not ordered the equipment or supplies, you could already start offering the treatments to your patients. You could offer them 20% off if they prepay for the upcoming service offerings. If you sell 20 of these treatments at a price of $1,500, then you would have $30,000 payday just by having people prepay. An added bonus of this strategy is that by pre-selling you just financed the equipment and supplies needed for the teeth whitening service. There is no need to dip into your savings and no need to go to the bank for a loan. Using the same example above, if the teeth whitening equipment cost $10,000, then you just made a $20,000 profit or a 200% return on your investment at the time of purchase. To put this perspective, if you would have invested in the Down Jones January 1, 2008 as of August 27, 2008, you would have a return of -11.8%.
Discount for cash payment
This is a spin off of the prepay strategy discussed above. Many people who work in private practices may still bill people for services. A hospital I worked at in L.A. gave huge discounts for cash payments on the day of service. It incentivized people to pay in cash. Not only did that help get money in our account sooner, but it significantly reduced man hours needed for billing. Those savings were passed along to the customer in the form of reduced prices for cash payment.
Late Fees
If you bill your customers, start charging late fees. The easiest way to determine what your late fee should be is to decide on an annual interest rate you will charge and then divide by twelve. For example, you want to charge 12% annually for being late, and then you monthly late fee would be 1%. One thing you must do if you charge late fees is to make sure that the late fees are part of the original agreement. Best practices would also dictate that you make sure the late fee rate is clearly identified on all statements and invoices.
Deposit checks from your personal computer
This is probably the coolest strategy of all. Right now, Irwin Union Bank has a product called the MicroBank. This device lets you scan checks right from a personal computer and lets you immediately see those checks in bank account. Imagine scanning a check through this device and immediately seeing your bank balance increase on your computer screen. Instead of making deposits every couple of days, you could make them every day. This product can seriously accelerate your cash flow if you are dealing with a significant amount of checks.
Hopefully, one of these four strategies will significantly speed up your cash flow. Life keeps speeding up. In the last 40 years we have gone from snail mail and office memos, to the fax machines, to e-mail, and now to text message. And with text message, we have even invented another version of shorthand because we don't have enough time to spell out the words. So @TEOTD, increase your bank account balance by increasing how fast you get paid.
(For all you text message newbie's @TEOTD = at the end of the day).
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Ever wonder why there is check advance business on every corner? Well, in our fast-paced society everything is speeding up. And guess what, we also want to get paid faster too. We want tomorrow's paycheck yesterday. There are several business-savvy w
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