Manchester
Learn the basics of framing with
Nick in Manchester
High wycombe
Learn the basics of framing with
Linette in High Wycombe
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1 tip to improve cash flow in your framing business overnight
As a bespoke picture framing wholesaler we supply galleries and framing shops on a weekly basis with completed framed work for their customers. After the work is complete they are billed for all the jobs at the end of each week. However, I have come to realise that I have two types of clients when it comes to paying.
- Always behind on payments and always catching up (20% of customers)
- Paying on time, everytime.(80% of customers)
But why is this? I started to look into each business and very quickly realised there was one big factor that set them apart. The customers that always pay on time all take 100% payment upfront when the customer is placing the order. The other customers who are always catching up take only 50% deposit or no deposit at all.
The issue with only taking a 50% deposit is that when the job is complete we (All About Framing) require payment for the job. However, their customers might be on holiday or busy for the rest of the week which delays them returning to the store to collect and pay for their Frames. The record for the longest returning customer is 2 years! The shop owner still needs to find a way to pay for the goods though and there’s only so much time you can delay before it catches up and then you’re the late paying customer.
What’s the best way to overcome it?
There is a very simple trick that can change you from being a “Late paying client” to a “Paying on time client” overnight. When your next customer places an order instead of saying “we ask for a 50% deposit” try saying…
“The total will be ……… Would you like to pay by cash or card”
And then don’t say anything and let the customer respond. 9 times out of 10 they’ll just smile and be okay or if they’ve shopped with you before they might say “Oh I thought it use to be 50% up front” to which you can simply reply “Yes, we did but we’ve updated our process, would you be able to pay the full amount now?”. After a couple of months it will be long forgotten that you ever did 50% deposits.
What about the customers that refuse to pay all upfront?
Although most customers will be more than happy to adapt to your new process, there will always be customers who feel that the rules do not apply to them. But by this point, it doesn’t matter as 9/10 of your customers are paying upfront and they have covered the cost of your customer who refused to pay. I simply address these people by saying “Normally I can’t do that, but for you I’ll make an exception”. But make sure the next time they return for more framing you follow the same process of saying “The total will be ……… Would you like to pay by cash or card”.
The message will eventually get through.
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