Bookkeeping Case Study #3

Who Owes You What? Debt Recovery

One of the major problems faced by small business owners is a high rate of debtors. Many small business owners know they are working hard and also know that they are making a profit yet they despair that they just never seem to have any money available.

This was the case for one of our clients who runs a busy and successful franchise. His business was doing more work than ever. He was picking up new customers all the time and his staff were working efficiently enough.

He sought the services of Nifty Bookkeeping to help him out with his general bookkeeping. After an initial assessment by Nifty Bookkeeping's manager Janice Marken it was decided that he would need a Nifty Bookkeeping staff member for three days a week to bring things up to date and then for two days a week continually after that.

Within a couple of days the regular bookkeeping highlighted some key issues within his business operations that were affecting his success and his lifestyle.

The main issue was that he had virtually no procedure in place to track the money that was owed to him by his clients. Not all of his clients paid for his services on the day and some were repeat customers.

After further bookkeeping it was discovered to his amazement that he was owed thousands of dollars in payments. The first thing that the Nifty Bookkeeping staff member did was to make a list of all money owed then telephoned each client and requested payment. Almost all were happy to write a cheque right then. Some even said they had been wondering when they were going to be asked to pay for the service.

The client instantly had thousands of dollars available in cash. A new system was designed, implemented and maintained whereby invoices are raised immediately and debtors are tracked and reminded at appropriate times.

This has resulted in a more successful business and a more relaxed and confident owner.