It’s a well documented strategy in real estate to pay your tradesmen up front. That way you develop a reputation for being worth working for. When you want something done, you get it done quick. And in business speed is a massive advantage.
It is the same for your start up. We pay for things as soon as the bill arrives. Electronic transfer, bang! Then email them the receipt through to them. Beside the fact that we have little choice, we’d do it any way. You see, this is how we are building our team – our heavy gauge supply chain. Suppliers know we pay quickly and we’re good for it. Next time we are in a hurry to get something done, or we’re asking to cut lead times, who are the suppliers going to help? The slow payers or the quick payers? Silly question really. But the reason it is relevant is that most start up’s supply chains are full with SME’s. And SME’s suffer as much as you from the cash trap.
If you have a promising start up proposition, speed might be the key to beating another entrepreneur to market. Don’t reduce your chance of success by paying slowly.
About that money you owe me ….
Cheque’s in the mail 😉