You’ve simply saved somebody’s basement from flooding, spent hours below their home fixing burst pipes, and introduced them with a good invoice for professional work. Then they smile and ship the 5 phrases each tradesman dreads: “I’ll mail you a examine.”
In my 15 years in enterprise, I’ve discovered that the most important challenges aren’t at all times staffing or competitors. Most of the time, it’s prospects who don’t pay their payments. The elevated integration of bank cards into billing software program has modified the sport and ensured that small enterprise homeowners like me can receives a commission simply and on time.
Now there are efforts on the State Home to make bank card funds tougher and sophisticated. These efforts not solely threaten the comfort that helps tradespeople receives a commission however might additionally fully upend the system of bank card rewards that profit tens of millions of customers throughout Massachusetts.
Collections have been strangling me for my first decade in enterprise. I’d ship a two-person crew to deal with emergencies or set up water heaters, ship flawless work, ship payments, then spend numerous hours chasing fee. Some prospects paid promptly, however others vanished solely, leaving me holding the bag for elements and labor. I spent hours weekly making assortment calls as an alternative of precise plumbing work. We needed to issue unhealthy debt into pricing, which means dependable prospects have been basically subsidizing the deadbeats.
All the pieces modified once I began integrating bank card funds into my accounting system. What appeared like a minor change fully revamped my complete operation.
Right here’s the game-changer: the blokes who pay with bank cards now are a number of the identical guys who used to stiff us on payments. The money circulate distinction has been transformational. After I ship an bill they will pay on-line immediately, it will get processed instantly as an alternative of sitting in a mail pile for months. Meaning assembly payroll with out breaking a sweat, paying suppliers on time, and investing in cutting-edge gear.
It additionally signifies that good prospects who’ve plumbing emergencies however don’t have money instantly obtainable can nonetheless get the service they want and pay their payments. The previous system was hemorrhaging cash in hidden methods, however digital funds eradicated that administrative nightmare, which means I can give attention to what I do finest as an alternative of chasing cash.
Rewards play a key position too. I began utilizing my enterprise bank card for all the things: Elements from suppliers throughout the South Shore, gear from distributors in Boston, even workplace provides. Whenever you’re shopping for pipes, fittings, water heaters, and instruments recurrently, these purchases generate sufficient rewards to cowl issues like truck upkeep or insurance coverage premiums. It’s like incomes money again on all the things I must run my enterprise. Plus, each buy creates an ironclad paper path that makes bookkeeping infinitely simpler throughout tax season.
The payments being thought of on the State Home would flip this method on its head. Some would basically require me to barter with each particular person financial institution behind any buyer bank card (not Visa or Mastercard, however whichever financial institution or credit score union really issued the cardboard), whereas others would prohibit the usual processing charge that protects me from fraud and funds the rewards applications. These are unhealthy proposals for small companies, and unhealthy proposals for the customers who assist us.
Right here’s what I want I’d understood 15 years in the past: the distinction between surviving and thriving usually comes all the way down to turning your largest weak point into your best power. Bank cards reworked my worst prospects into my most dependable payers and my vital bills into revenue facilities. Each tradesman who’s ever held an unpaid bill is aware of precisely what I’m speaking about.
Joe Nadeau owns J.S. Nadeau plumbing, serving Southeastern Massachusetts for 15 years.
