Selling on credit is a reality in many small businesses: the trusted customer who pays at the end of the week, the one who takes the groceries and pays later. Well managed, it builds loyalty. Poorly managed, it becomes money that never comes back. The difference is almost never the customer: it is the order with which you handle it.
Why credit gets out of control
- It is written in a notebook that gets lost, gets wet or only one person understands.
- It relies on memory: “I think he owed me around fifty.”
- Nobody checks who owes until the balance is already large.
- There is no clear rule on who gets credit, up to how much and for how long.
- Collecting is uncomfortable, so it is left for later.
Almost all of these problems share the same root: credit is handled as a favor and not as a sale. When you treat it as one more sale, with a record, an amount and a date, it becomes much easier to control.
Basic rules to sell on credit in an orderly way
- Decide who. Sell on credit to customers you know and who have bought before.
- Set a limit per customer. It's the maximum amount you're willing to lose if something goes wrong.
- Agree on a term. “I'll hold it until Friday” is better than “whenever you can.”
- Record each sale at the moment, with date and amount. Not at the end of the day.
- Record each payment and give the customer a receipt.
- Review once a week who owes and since when.
- Collect early and politely. A timely reminder costs less than a late collection.
You don't need to apply all of them from day one. If you had to start with one, start by recording each credit sale at the moment and reviewing the list every week.
- 1Decide who
- 2Set a limit and a term
- 3Record the sale
- 4Record each payment
- 5Review every week
- Zero balance: account closed
What to record for each credit
- Who the customer is and how to reach them.
- Date of the sale and what they took.
- Total amount and payments made.
- Outstanding balance.
- Date agreed for payment.
| Customer | Sale | Payments | Balance | Agreed date |
|---|---|---|---|---|
| Customer A | $120,000 | $50,000 | $70,000 | Friday 14 |
| Customer B | $80,000 | $80,000 | $0 | Closed |
| Customer C | $200,000 | $0 | $200,000 | Overdue |
| Total balance receivable | $270,000 | |||
Notebook, spreadsheet or system
A notebook is quick, but it gets lost and warns you of nothing. A spreadsheet organizes better, but it takes discipline and someone to keep it updated. A point-of-sale system with credit sales records the debt at the moment of the sale, subtracts each payment and shows you who owes without you adding anything up.
What matters is not the tool, but that every credit is written down and that someone reviews the list often.
How to collect without damaging the relationship
Collecting doesn't have to be uncomfortable. A short, kind and specific message usually works:
- Greet them by name.
- Remind them of the balance and the agreed date.
- Offer an easy way to pay.
- If they can't pay everything, propose a partial payment or a payment plan with clear dates.
Warning signs
When you see a sign, stop new credit sales to that customer, talk to them and agree on a payment plan. If the amount is high or the situation gets complicated, consult a lawyer.
- A customer who asks for more and pays less each time.
- Repeated excuses for every payment date.
- Balances that grow without anyone reviewing them.
- Customers who stop buying but still owe.
How QonttaPOS helps
QonttaPOS manages credit sales with their payments: you record the sale and each payment, and you see each customer's balance. The daily diagnosis with Qontta IA summarizes what to attend to. And we are building the Collector agent, which will propose who to remind about payment and you will approve before anything is sent; it is not available yet. You can see what is included today at qonttapos.com.
