Christchurch Earthquake - A Business Mentor's Story (A New Week)

...... Next week will be an interesting week, the government are asking everyone to go back to work as soon as possible to help keep the local economy going, a move I totally agree with, but in reality, will be very difficult for some, as for my clients, at this point I do not know what they will do.  I wait for next week with a large amount of apprehension, only then will I know for sure how much of a direct impact the earthquake will have on my lively hood .............

This is the fourth blog in the series following my road to recovery, if you haven't already, it would pay to read my previous blogs in this series (Part 1, Part 2,Part 3, Part 4) to understand how I have arrived at this point.

My longest running client was the first on my list, the news was not good.  Having been displaced twice previously from their offices, the first time after the September 4th quake, then again after the Boxing Day aftershock, this client had only just moved into new premises on Monday 21st February, the following day the most recent quake hit, they were in the office at the time, watching everything around them, very quickly being destroyed.  They all managed to get out of their building and escape to safety, now they have nothing, all their equipment was destroyed.  The client is resilient, they are currently talking to their insurance company to get the equipment replaced as soon as possible so they can carry on doing what they do best.  We have agreed to catch up later in the week, I am going to donate my time (at no cost to them) to help them re-focus, prioritise what needs done immediately to help them get back on track as quickly as possible.

My other clients have work premises that did not get hit quite so hard, they should recover reasonably quickly, albeit some of their homes are nearly destroyed.  There is a very mixed bag of issues everyone is facing, having talked to all those that were contactable.  I realise that really, my family and I are blessed, we still have a roof over our heads, we have power, we haven't lost any friends or family, I really, under the circumstances can't ask for anything more than that.  It is likely to be another couple of weeks before my clients get truly back on track, financially I will be able to cope with that, so I carry on down my list and tackle other areas of my business.

Cash flow will be really important over the next couple of months, having wrestled within myself over the weekend as to what I should do with those who have not paid my invoices, I decided to follow them up.  My reasoning for this was, the invoices were all ready over due prior to the earthquake hitting, so no-one can really blame that as a reason for delaying the payment; also, I have already done the work, I do this not only to help the client but to put a roof over my families head and to put food on the table, that more than ever is of the greatest importance.  So I send out another email, it's short, straight to the point, "This invoice is now well over due, please give this your immediate attention", there is nothing soft about the email, it is designed to spur the client into action.  To any business owner in a similar position, there are a number of things you should consider when ensuring you're clients don't compomise your cash flow:

1. Make sure your terms of trade suit your business.  If you need your bills paid in 7 days then ask for the invoice to be paid in 7 days.
2. Make sure your client is fully aware of your terms of trade before you start doing any work for them.  If it is a big company, I will always ask them if my terms of trade will cause their accounts department a problem, if you anticipate these potential hurdles at the start, it will save you an awful lot of hassle down the line.
3. No matter how big your customer is, do not let them dictate to you, when your bill will be paid.  If they had to engage in your services in the first place, it is because that big company needed you, be firm with them and don't be shy in chasing them up.
4. If you find your client has missed the invoice due date, do not keep waiting to see if they will pay.  The first day after the due date send them a reminder that it is late (I have one client that does something better - they send their clients a friendly reminder the day before the due date, informing their clients that they need to pay their invoice tomorrow) and ask them to pay it immediately.
5. Your reminder should be straight to the point, no long winded stories about how you may be sorry to have to send this email and don't put anything about, if you are struggling to pay this invoice, call us to discuss alternative payment arrangements.  You are not a bank, you should not have to finance your clients (they have their own bank, that's what they are there for).   The message should only read - you have missed an invoice, please pay it immediately.
6. If within 7 days, they have not paid, follow up with a phone call, people are generally apologetic on the phone (or face to face), ensure you do not stop the conversation until you have a promise when and how much will be paid.  If what they offer is not to your satisfaction, stick to your guns and push for a more amicable solution.
7. Repeat offenders, no matter how big, should be put on a cash only, or payment in advance to remove the stress of knowing whether or not this time the client is going to put you into debt.

My focus now is two fold, firstly how can I help more small to medium business owners, immediately and second, how can I get my name out to more businesses in and around Christchurch to ensure I have a reasonable pipeline going forward.  Whilst putting some plans in place (more on my next blog) I get a call from an associate of mine that works as a Marketing Strategist, we catch up regularly to see how our businesses may help one another.  He happened to thinking along the same lines as myself, how can we, by joining forces, add value to many other business owners in Christchurch.  As we talked, some very exciting ideas starting coming forth, the meeting is on Tuesday, the results of that meeting I will also talk about in my next blog.

As I finish up, I would like to express my sincere and humble thanks to all of you out there that have found and started reading this series of blogs, I cannot believe the comments and emails that are coming back to me directly, all of them are really helping me stay focused, they reinforce that what I am doing regarding the creation of this series is right and is starting to have a positive impact to people not only in Christchurch but also around the world, I never imagined they would be so far reaching.  May I also give a special thanks to Debra Donovan from New London, Connecticut, US who kindly sent the picture in this blog of the Cathedral, ironically I have lived here for over 11yrs and never taken a picture of the Cathedral myself - it's such a beautiful building.

Many, many, thanks :-)