Two different numbers
Deals bookedwhat customers committed to pay
Cash in the bankwhat actually arrived
The gap between them is your receivables. Until it shows up as its own figure, the team lives in an illusion: quota looks met and the money is not in the account.
Why the later payments never arrive
- no payment schedule recorded in the system
- no reminder, to the customer or to the rep
- the rep counts the deal closed after the first payment
- nobody is paid for collecting the rest
How to build the process
- Record the payment schedule on the deal: dates and amounts.
- Set a reminder for the rep two days before each date, and on the date itself.
- Keep a separate overdue-receivables list, visible every day.
- Add collected instalments to the comp plan as their own line.
- Once a week, go through the overdue items with the reps.
On a project with a deal size of around $2000 we did more than connect payment providers: we built the administration of receivables, controlling schedules and driving transactions through to completion. Cash collected reached $157,000 against total deals booked of more than $220,000, and the figure kept growing.
What to measure
- receivables as a share of deals booked
- average time from the payment date to the money arriving
- overdue receivables older than 30 days