Are you running your business or is it running you?
Are you in the habit of paying invoices as you receive them?
Perhaps someone once told you this was good business practise? Or maybe you just worry that not settling an account immediately will land you in hot water? Ironically, you can find yourself in as much trouble by responding too quickly.
Scam artists are using increasingly ingenious tactics to separate business owners from their hard-earned money. Small businesses, including several medical practices I’ve worked with, have been caught out by not following due process in settling an account.
This makes it vitally important to ensure that invoices you receive are from the supplier who serviced you and that all the details you have on file for that supplier match those on your invoice – especially in the case of bank account information. If you don’t take the time to check you may be caught by a fraudster who has obtained a supplier’s information and inserted his or her own bank account information.
Fraud risks aside, taking a more considered approach to paying invoices has other benefits. Did that contractor actually complete all the work they invoiced you for? Did this supplier deliver everything they’re charging you for? Are you getting value from that directory listing you signed up for on a whim five years ago?
Asking yourself, and your staff, questions like these about invoices rather than automatically paying them can have a very real impact on your bottom line. Asking similarly probing questions before you even enter into a contractual relationship in the first place can be even more important.
Which brings me to a wider point.
Small businesses should take a leaf out of their larger corporate counterparts and put in place proper business processes for managing payments of accounts and many other month end procedures. This gives you the owner an opportunity to carefully apply your mind to the management of your business, without being distracted by you core task of patient care.
More importantly, it allows you to then focus on that core task without ad hoc purchasing decisions and payments constantly intruding.
At Vizibiliti we recommend that you schedule a regular monthly time with your most senior staff to meet and go through the month end processes which affect your business.
This may include:
- Payment of all invoices once they are checked and approved for payment
- Checking that all the goods you ordered in the month where received and if used perhaps approve the following month order
- Paying salaries and statutory payments like VAT, PAYE and Rent
- Planning for staff who will be on leave
- Allocating certain tasks for the month
- Reviewing contracts with suppliers that may need to be renewed or changed
- Planning for upcoming holidays and the relevant patient communications
Too many small business run in a reactive mode where clinical work is interrupted by an urgent business requirement which does not get the proper attention and as a result poor business decision are made due to poor judgement.
The result is that too many practitioners call me in a crisis, needing to unravel an erroneous payment or poorly considered contract they’ve signed.
Business decisions, like a clinical treatment plan for patients, need proper time and attention.
While this may seem like a daunting prospect, at Vizibiliti we have a track record of working with clients to establish simple, yet powerful business management systems. We’re able to tailor make one for your specific requirements, empowering you to make the right choices for your business by being properly informed of all the facts.
Isn’t it time you stepped out of reactive mode and proactively took back control of your business processes?
Vizibiliti Management Services – Enabling focus, creating clarity