Exclusive from Bill Chaser: The top three tips to avoid bad debt in business
No matter the size of your business – facing unpaid invoices and bad debts is a very real scenario
For small businesses, sole traders and tradies across Australia – the threat of bad debt is even more pressing. Research shows late payments are often the number one problem this category of business faces – and unpaid invoices are becoming significantly more than just an inconvenience.
There are a range of practical steps that all businesses can take to avoid bad debt, ensuring invoices are paid in full, and paid on time. I have compiled my top three tips that you can start implementing today – avoiding even one more day of unpaid debt.
Tip One: Get An Agreement
It’s crucial that you get an agreement in writing, and get it right. Many national small businesses and tradies don’t have a formal agreement or contract process – leaving them without clear terms and conditions for the job, and no solid ground to follow-up on late payments. Another hot tip: swap out the word ‘estimate’ for the word ‘quote’ when providing an overview of any job to potential clients.
Tip Two: Align Your Terms Of Service With Your Business
Ensure that the terms and conditions of any contract or agreement truly meet your business needs. Take care to draft your own contracts, read third-party documents thoroughly, and have them double-checked professionally if you’re ever in doubt. Be sure to also add any potential collection fees onto the cost of the quote.
Tip Three: Value Your Products And Services
In small business and as tradies, it can be hard to put a price on our products and services, to the end that we keep our business needs as a priority in our transactions. Be confident in your business offerings – never be afraid to ask a client for a deposit (especially if you have high costs-of-goods sold) and then back yourself to deliver on the quote.
There are small changes every business can make to avoid the possibility of bad debt altogether. Be sure to prepare, stay attentive, be confident and remain patient to work through every quote, contract and agreement thoroughly – putting yourself in the best possible position of getting paid on time, and getting back to doing what you do best.
James Stewart is a Managing Consultant for Australian debt specialist Bill Chaser Pty Ltd
Timeline: India takes unicorn leap with six in five days
We chart an historic week in India’s tech industry, where in just five days, between 5-9 April 2021, the country achieved six new unicorns, bringing India’s total to 10 in 2021 to date, an immense unicorn leap from just seven in 2020 and six in 2019.
April 5: Meesho
India’s first social commerce unicorn, Meesho raised US$300m from SoftBank, Facebook and Shunwei Capital, giving the Bangalore-based startup a US$2.1bn valuation, a threefold jump from its previous funding round in 2019. Founded in 2015 by two IIT-Delhi graduates, Meesho connects producers and resellers, helping small businesses sell through social media. It has 45m customers and has enabled 13m entrepreneurs to start their online businesses with no investment.
April 6: CRED
Founded just over two years ago, Bangalore-based credit card repayment app CRED raised US$215m from Falcon Edge Capital and Coatue, nearly trebling its valuation to US$2.2bn from its January US$80m round. Allowing customers to pay off their credit card debt while earning CRED coins which they cash in for rewards, CRED has grown rapidly during COVID-19, doubling its customer base to nearly 6 million in a year.
April 7: API Holdings / Groww
The first epharmacy startup to gain unicorn status, PharmEasy (API Holdings), which has digitised 60,000 brick and mortar pharmacies and 400 doctors across India, raised US$350m in a round led by Prosus Ventures. Founded by four former Flipkart employees as a way of making investing simple, investment platform Groww became India’s second-youngest fintech unicorn, raising US$83m in Series D funding led by Tiger Global, quadrupling its previous round in September.
April 8: ShareChat
New Delhi-grown social media startup ShareChat, founded in 2016 by Mohalla Tech raised US$502m from Lightspeed Ventures, Tiger Global, Twitter and Snap taking its raised total over six rounds to US$766m and pushing its valuation to US$2.1bn. The funding will be used to grow its user base and short video platform Moj, which launched in 2020 following TikTok’s ban in India. The regional language startup claims 280m users.
April 9: Gupshup
AI-led conversational message startup joined the unicorn club after raising US$100m from Tiger Global giving it a ten-fold valuation of US$1.4bn. The smart messaging platform, which has seen accelerated growth during the pandemic, was founded in Bangalore in 2005 by serial entrepreneur Beerud Sheth, whose online freelancing platform Elance is now listed. Gupshup’s API enables 100,000+ businesses to build messaging and conversation experiences across 30+ communication channels.