The end-to-end process of taking a customer order, fulfilling that order, invoicing the customer, and collecting payment is referred to as Order-to-Cash or O2C. To streamline this process, one should consider each step in relation to the other before pulling the trigger on any single component.
With that in mind, let's start at the end and talk about collecting payment. Getting paid in a timely manner is one of the most important factors to success in any business. Providing customers with a wide variety of payment options helps increase deal volume and size, as well as conversion to cash. Here is what you should consider:
Ways to Get Paid
- Cash/Check
- Debit/Credit Card
- Bank Transfer (ACH/eCheck)
- Wire Transfer
- Digital Wallets/Mobile Payments
- Barter (allowed, but not recommended)
- Customer Financing/Buy Now, Pay Later (BNPL)
What You Need in Place
- Bank Account - at a minimum, every business owner should have at least one business checking account titled in their business name. This is best practice when it comes to maintaining the liability protection of your legal business entity and avoiding the commingling of business and personal transactions. In most cases, and in the context of the other steps in the O2C process, we recommend using big name banks for their online/mobile banking technology, fraud protection/resolution capabilities, and access to small business credit cards. My top 5 include: Chase, Capital One, U.S. Bank, Bank of America, and Wells Fargo.
- Merchant Services Account - if you want to take any form of payment beyond cash or check you need to open a merchant services (payment processing) account. There are many notable companies to choose from, including Stripe, Square, PayPal, Chase Payment Solutions, or even those offered through the quoting, CRM, and communications tools often used in our business. However, we highly recommend that you take advantage of the pre-negotiated rates and full software integration provided by Intuit (QuickBooks) Payments. (See below link to payment and financing flyer for more information)
- Consumer Financing Account - like merchant services, being able to offer customer financing provides additional payments options for the customer (e.g. same-as-cash) and statistically leads to more and bigger deals. Once again, there are a variety of options to choose from, including those from our designated suppliers (via Synchrony, GreekSky, and Wells Fargo) or home services software companies like Hearth and Jobber. However, Made in the Shade Home Office has engaged in a direct partnership with Regions Home Improvement Financing to provide franchisees with the best loan options, highly competitive rates, and lower dealer fees. As a MITS franchisee, there is no qualification needed and no cost to open and maintain an account. We recommend that all owners open an account. (See below link to payment and financing flyer for more information)
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