Best payment terms!!!!! Can you please advise??

[Kat27Bro]

Good afternoon,

I need some advice regarding payment terms etc.
What I would like to know is, 'What time scale should I allow my customers to make their payments'?

The magazine will be due for publication at the beginning of each month. When would you be happy to make your payment by??

I want the company to work well with its customers, who will be other business owners. Therefore, your feedback, plus any other information you feel may be necessary, is very much appreciated.

I hope to hear from you soon.

Thanks

 

[SFD]

Is this for people subscribing to the magazine, advertising in it or something else?

 

[Kat27Bro]

Hello,
People will be buying advertising space.

 

[Mattonella Tile Studio]

The two main publications we advertise in differ.

Number 1 invoices us at the time the magazine is published, giving us 30 days.

Number 2 asks for payment at the time of booking the space, approx 2 weeks before publication.

So I guess it's up to you how you want to run your credit.

 

[fred1222]

Unless they are bluechip advertisers you're dealing with I'd expect payment in advance of print. In today's climate I think you'd be foolish to offer credit especially as you'll be outlaying a substantial amount yourselves

 

[Kat27Bro]

Thanks for advising me. Your information will be useful to me.

I have just had a look at your site, and although you are not based in Liverpool, the products that you offer could be requested by individuals all over the UK. Therefore, if you think you could benefit from advertising within the Liverpool area, let me know and I will advise you of our temporary web address.

Thanks

 

[DavidT]

Also keep in mind that you don't have to offer the same terms to all advertisers. Some may show they are less risk than others and terms can reflect that.

As mentioned, it really is up to you. Some people may expect credit, but unless it is something you want to give and deal with it is your decision.

For advertising you may also come up with a mix of packages, with associated payment terms.

David Toohey
The Accountants Circle
Accountancy & Bookkeeping Forums | Accountant & Bookkeeper Blogs | Company Formations from £21! | Business Start-Up Package

 

[Kat27Bro]

You are right. I supoose it would be best for me to base the payment terms around the clients.
Thank you

 

[profitxchange]

There are two things to think about
How reliableyour customers MAY be in paying up. I would suggest for your activity its money up front always.
The second is how much credit can you afford if clients don't pay for 60-90 days how much will this cost you and do you actually have the money> and why should you if you don't need to.

 

[Kat27Bro]

Great advice.
I am definately better asking for payment upon agreement of the final advert draft and before the publication goes to print. Basically, if they haven't paid their advert isn't published. It gonna be easier and a lot less hassle doing it that way I think.
Thanks

 

[Peter Bowen]

Great advice.
I am definately better asking for payment upon agreement of the final advert draft and before the publication goes to print. Basically, if they haven't paid their advert isn't published. It gonna be easier and a lot less hassle doing it that way I think.
Thanks

You might bump into problems doing it this way in the beginning. I know I got caught out once paying up front for advertising and then the magazine never got published (I hope I got wiser as I got older).

A couple of people using our automatic debt collecting system are in the business of selling advertising. I spoke to one of the guys about this last year and he told me that in his business (he sells print advertising) normal payment terms are 7 days after publication, a 5% discount if settled early and then he chases hard and fast after that. He hands debts over 30 days after publication if he hasn't been paid. (He makes some exceptions for government and blue chip clients)

Cheers

Pete