“We can’t require payment at time of purchase.”
Many owners tell me this.
Why?
- It’s not how our industry works.
- Buyers won’t stand for it.
- We don’t know what the final price will be.
The first two are external factors and the last one is all on you. Let’s consider ways to respond to these objections.
It’s not how our industry works.
Sometime long, long ago, someone in your industry decided to give buyers the privilege of paying long after the purchase. Others jumped on the bandwagon because they thought it gave them a competitive edge or because they didn’t know what the final price would be.
Then T&C of 30, 60, or more days became the norm.
Here you are in 2026 stuck with this practice that costs you money and causes the stress of negative cash flow.
You can counter this practice with 2 steps.
- Fixed or predetermined prices known in advance.
- Deciding that payment at time of purchase is how your company does business. Period.
If you have wanted to be innovative and in charge of your company’s destiny, you will see the move to zero AR as the key.
When your revenue is in the bank as cash today, you have complete control over everything else. Otherwise, you are at the mercy of strangers who do not have your best interests in mind.
Buyers won’t stand for it.
This may be true and zero AR will cause some buyers to go elsewhere.
Let’s not let the tail wag the dog.
Instead of obeying the demands of the most resistant buyers you can decide to do business only with those who will accept your terms.
They will be your best clients. They’ll have deep trust in your promise to deliver. They’ll fulfill their responsibilities so you can keep moving forward. You will feel like partners not adversaries.
We don’t know what the final price will be.
This is completely on you to fix! No excuses.
You have the information you need right in your own sales data to offer fixed or predetermined prices.
- Look at the past dozen or so buyers. What did they buy and how much did they pay (after the fact.)
- Give each type of work a name or identifier. When the next customer wants something similar, simply price it the same as the price you charged the previous buyer.
- Track these sales for a few months and assess how closely the new work was to the previous work. Adjust your prices for future work accordingly.
Is this perfectly precise?
No. But it’s the most effective way to transition to and gain confidence for fixed/predetermined pricing.
Remember the goal is zero Accounts Receivable!
Questions for me?
Many Owners get stuck on one or more of these 3 points. If that’s you, please send an email and we can discuss it.
- What do I say when someone argues with me and says, “no one charges in advance in our industry”?
- How do I tell regular buyers that we’re changing our terms?
- How do we not get killed by scope creep?
Only you can achieve the goal of zero AR.
If not now, when?
