Closing the sale (Supply Goods/services and collect payment)

 Closing the sale (Supply Goods/services and collect payment)

(Step 16 of our How to Set-up new business guide)
You have done marketing efforts, doing promotion and selling, and encouraging your customers to purchase your products. You have collected orders, now it’s time to supply the goods/service and collect payment from your customer.

Selling a product/service is not enough especially in business that run at credit payment term basis. In pharmaceutical, ayush, cosmetic and wellness industry also credit payment terms are common. A sale is considered to be closed or final when you complete a sales transaction i.e. receive your payment.

Closing the sales is referred to the process of making a sale. Closing a sale may mean different for different industries. Here we are referring to closing the sale to the process of final transaction i.e. supply the goods and collecting the payment.

Collecting the payment is not referring here to immediately receive the payment after supply of goods/services but at mutual agreed terms. If you have 30 days payment terms then you must receive your payment at 30 days plus minus 5 days.

As we have discussed in previous step, you should check for customer’s reputation before taking orders from them. You can supply any amount of goods to your customers but if you are unable to collect payment from them timely then you haven’t completed a sales transaction and this will take your business to downside instead of growth.

Most of persons think selling goods and making presence in market is most important in starting. Once you have established your business, payment will start to come but that not the case. You should concentrate at closing the sale even at your first business sale i.e. collecting the payment along with selling goods.

If Sales is blood of business then payment is oxygen. You can’t survive without oxygen. More than sale, payment collection is important. Doing one lakh sale per month with 98% payment collection is much more than beneficial from doing 5 lakh sale per month with 80% payment collection ratio.

In business at initial stage, payment collection is crucial because your business don’t have payment losing capacity. It your customer don’t pay you at time, then chances are you will not pay to your vendors at time and ultimately regular availability of stock will affect. With time this will lead to business failure.

Approx. 50 percent of start-up fails within first few years, and Insufficient working capital and mismanagement of finance are one of the key factors of business failures. You can’t invest or arrange money for business from outside sources again and again. At some level, your business must generate enough amount to pay own bills and yours too. This business income we come from selling goods/services and collecting payment.

Don’t ignore this part of business. It will not affect your business start-up level. You can easily set-up business by ignoring this step but it is very difficult to sustain and grow your business. You will find all type of customers; some will be good at payment and some will not clear your dues. That’s up to you, how you handle your business transactions.

This is our last step in our how-to set-up new business guide.

Hope we have provided some help to you regarding starting up new business.

Best of luck...

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