Growing Your Business

Experts Share How Small Businesses Are Using Modern Technology to Get Paid Faster

by
Lee Reams II
on
3/11/2018
Experts Share How Small Businesses Are Using Modern Technology to Get Paid Faster

For the vast majority of businesses out there (and small businesses in particular), getting a handle on cash flow is about more than just "money in versus money out" — it's about literally building a stable foundation from which an organization can continue to grow and evolve over time. Every day that a business owner has to wait to get paid is a day that they're operating at a supreme disadvantage in more ways than one.

It's a day that they are forced to watch opportunities pass them by instead of capitalizing on them. It's a day spent worrying about when that money is going to come, or if it is going to come at all. It's a day filled with dread and uncertainty, especially since 82% of the businesses that fail do so because of problems like these in the first place.

But thankfully, it's the type of day that fewer business owners are being forced to deal with all the time, thanks largely to the wonders of modern technology. In fact, many accountants are reporting that their business clients are using tech-driven assets to get paid far faster than ever before in a wide range of different ways that are definitely worth taking a closer look at.

The Power of Electronic Billing

Many business owners aren't just using technology to reconcile their books and process funds faster — they're rebuilding the ways in which they even accept payments to begin with from the ground up with the future in mind.

Peter W. Flournoy, CPA, said that "many of my clients are using electronic billing features, like those available in QuickBooks online, to make everything from accepting payments to reconciliation faster than ever before." He also said that "many are also accepting credit cards as a way to receive revenue faster in the first place."

Many of the problems with the "old school" way of doing things has to do with how inefficient it was by its very design. If a client pays with a check, for example, you're talking about a lengthy process that is often far too complicated for its own good. First, you have to invoice the client and even if you do so electronically, there's no telling how long it will take them to actually get around to dealing with it. Then, you've got to wait for them to write the check. You've got to wait for them to mail the check. You've got to wait for the Post Office to deliver said check, and the list goes on and on.

But according to Alexis Gallati of Gallati Professional Services, the winds are now blowing in a decidedly more efficient direction. "Gone are the days of the check!" said Gallati. "There are many resources now available for getting paid faster, with popular choices including PayPal, Square and QuickBooks for credit cards, ACH bank transfers and more."

These advancements have led many businesses to re-think their payment structures in the first place, something that both accountants and their clients can be thankful for. Gallati continued: "the best way to see an increase in revenue is to eliminate your accounts receivable by requiring payment before providing the product or service to your customer. This may not work in all industries but you may be able to find a similar solution."

Business owners understand that getting paid faster means a lot more than just having access to funds sooner rather than later. It means addressing their cash flow issues in the best possible way. It means having less reliance on credit. It means making the very practice of business accounting easier in the first place.

In just a few short years, technology has managed to adequately address one of the largest pain points for many of the 27.8 million small businesses that operate in the United States each year. It's truly exciting to think about what other types of issues will no longer exist in the not-too-distant future.

Lee Reams II, writes for TaxBuzz, a tax news and advice website. Reach him at [email protected] or on LinkedIn.

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Lee Reams II

Lee Reams II

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I am a tax and business news junkie who has spent the last 20 years developing and executing "best in class" word-of-mouth marketing campaigns for tax and accounting professionals. With TaxBuzz and CountingWorks we have taken that same commitment to quality content directly to the consumer. Keeping you up-to-date with the latest tax law changes, business growth tips and planning strategies to help you reach your best financial outcome.

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