When customers don't pay you on time, it will affect your cashflow.   You will need effective strategies to manage your debtors, and ensure that you remain in business. 

Here are 6 strategies that you can use with your MYOB Accounting software to exercise control over your debtors.  

1. Set credit policy 

2. Review Payment History

3  Review problem accounts

4. Set reminder / alert at order stage

5. Categorise customers for detailed analysis

6. Analyse who buys and what they buy

 

Setting up credit controls and overall better managing of debtors will improve your chances of payment when things go wrong for customers.  

If your customers know you mean business, and if you take the appropriate steps in a disciplined manner,  they are more likely to pay on time. 

Detailed explanation of how to execute those strategies in MYOB Accounting software is shown below.

 1. Set a credit policy 

Set the credit terms and credit limit for each and every customer. This will set the boundaries for doing business with your customers.  

Once the policy is in place, stick to it as much as possible. It will be much easier to follow up on slow payers if the terms are clearly laid out from the beginning.

On special occasion, you may modify the credit terms.  MYOB Accounting allows you to  modify the credit terms for specific invoice,  provided the user has been given the rights to modify the credit terms and credit limit when raising the invoice.

Check out the references and credit ratings for new customers.  Try them out first, ask for upfront payment on the first few deals, before allowing them to purchase on credit terms.   

Make it easy for customers to pay you!  Encourage customers to make payments directly to your bank account.  Give a few options and state payment instructions clearly on the invoice. 

Give discounts for early payment.  It helps to improve your cashflow, and at the same time it reduces the possibility of delinquent accounts.   

The most efficient way to set credit terms in MYOB Accounting software is to set the default terms which is applicable to a majority of the customers, and then go the 'odd-one out' customer to customise the terms and credit limit applicable to him. 

To set default credit terms for customers, go to Setup  > Preferences > Sales, and click on the Terms  icon found at the bottom.   Enter the most appropriate terms applicable to your company.

   

The default customer terms will be applicable for all new customers that you create. To modify a particular customer's credit terms, go to Card File > Cards List.  Select the customer.  Click Selling Details, and change the relevant details under Customer Terms Information.  

2. Review payment history

Review each customer's payment history and note how many days he takes to make payments and compare that to his credit terms. 

Look out for early warning signs of a customer in financial distress - extension in number of days to settle payments, and an increasing level of debts.

Generate the following reports from MYOB Accounting software that will give you a snapshot of the customers' payment history: