For most wholesalers and distributors, the money is already earned. The goods are delivered, the invoice is issued, and the customer intends to pay. What's missing is a consistent system that turns an invoice into a payment on a predictable date.
The good news is that most overdue balances are a process problem, not a customer problem. Fix the process and the days it takes to collect fall, often without a single difficult conversation.
1. Agree payment terms before the first order
Terms that are only printed at the bottom of an invoice are easy to ignore. Agree them when you open the account, record them against the customer, and make sure the salesperson knows them too.
2. Send invoices the same day goods leave
Every day between delivery and invoice is a day added to your collection cycle. Same-day invoicing is the cheapest improvement most businesses can make.
3. Review ageing every week, not every month
A monthly ageing report tells you what went wrong. A weekly one lets you act while balances are still in the 0–30 day bucket and easy to collect.
4. Give every overdue account an owner
When everyone is responsible for collections, no one is. Assign each overdue customer to a named person and track what they did and when.
5. Record payment promises and follow up on the date
"We'll pay next Thursday" is useful information. Log the promise with its date and amount, then check on Friday morning whether it arrived.
6. Connect credit limits to order entry
If a salesperson can confirm an order for a customer who is already over their limit, collections will always be playing catch-up. Show the credit position on the order screen.
7. Measure days to collect, not just total overdue
Total overdue moves with sales volume. Average days to collect shows whether your process is actually improving. Track it monthly and by salesperson.
Where to start
- Pull this week's ageing report and assign an owner to every account over 30 days
- Start a simple promise-to-pay log
- Set a target for average days to collect and review it monthly