You’re Not A Charity (even if you are)

It's pretty safe to say you didn't get into business to be a bill collector (unless you actually are a bill collector of course).

One of the most frustrating aspects of running a business is chasing people down for money, if you let it be. 

Need #5 on the Sales Level of the BHN is "Collecting on Commitments", and the question we ask is;

"Do your clients fully deliver on their commitments to you?"

If you recall from past articles, the service provider/client relationship is a two-way street, and both parties need to be happy with the exchange. It's hard to be happy when people owe you money, it just is. 

You are a nice person, I get it. You want to offer a little leeway when someone is behind on their payments to you. Stuff happens. 

And you aren't wrong, stuff does happen. But at what point and to what level of frustration does their problem become your problem? if this is happening more than just occasionally, it's time to get serious about fixing it. You don't need the added stress. 

The fact is, if we have done the work up to this point, and are attracting the "right" clients that fit into your sweet spot, collections is usually a non-issue. Sure, once in awhile someone will have a credit card problem, have an account hacked, that kind of thing, but it won't be over and over and over. Yes, I have had a client (or two or three) like that too. 

Not only are you not a bill collector, you aren't a banker either. If someone owes you money for a service rendered, you have now become a lender to your client. A double whammy you don't need. 

So what to do about it?

  • First and foremost, get every client on EFT, or automated payments. In the fitness business it is now industry standard, most people expect it, so just do it already.
  • Have clear terms of payment in your contracts, as well as terms for non-payment. In your terms their should be a "cut-off point", or an upper limit to how much a customer owes you at which point you will no longer service them.
  • Track your receivables every month and make sure every client is current. It's really uncomfortable to go back to a client and say; "Ummm, sorry Cathy, but I just noticed your card hasn't gone through for the last 6 months". Oops.
  • Enforce your terms. Every time. 

Contrary to popular opinion, I am not cold and heartless. I care about my clients very much, but I am not a charity. And even if you operate as a not-for-profit, you still have bills to pay.

Remember, fulfillment of the terms of the agreement by both parties is included in and an integral part of the sales process. Selling to the right people matters. 

Here's a review of the Sales Level of the BHN.

  1. Know what your sales level target is in order to support your personal needs as the owner.
  2. Attract enough quality prospects to support the needed sales.
  3. Convert enough prospects to clients to support needed sales.
  4. Deliver on your commitment to clients on time, every time.
  5. Every client pays on time and in full. 

Is your company fulfilling every component of the Sales Level of the BHN? If not, it's time to Fix This Next.

Let's Make It Happen.

About the Author Dean Carlson

Dean Carlson believes that health & fitness professionals and gym owners do some of the most important work in the world, and deserve to make a great living doing what they love. Having scaled and sold one training gym in a seven-figure deal, he is still an active co-owner with his wife Nancy of another training gym, which keeps his knowledge of the fitness space current and practical. His mission is to help health and fitness entrepreneurs and gym owners create businesses that are wildly profitable and easier to run. Dean is a certified advisor and founding fixer for Fix This Next, an advanced level Profit First Professional coach, and Pumpkin Plan strategist. In 2016 he was recognized as the High Performance Business of the Year, and in 2018 earned the MindBODY Visionary Award.

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