Do you earn a salary? Salaries are like love and hot water. You only miss them when they’re missing. This is a little shout-out to all you salaried folk, especially those who have anything, anything at all to do with making payments to small businesses and freelancers: pay up on time. I don’t mean write a cheque on day thirty, or make a bank transfer on day thirty-two – I mean get the money cleared in their accounts by the due date. To those with a steady monthly salary, this seems such a bureaucratic little detail, but for a small business it translates directly and instantly into supplies, food and homeloan payments. And every day counts.

That ethereal number you’re punching into the company accounting system is actual money to a real person, and no excuse at all — ‘our creditors department is really busy’, ‘the MD is out of town’ — is going to change the fact that without that payment you’re leaving some brave entrepreneur well up the creek. For that entrepreneur, being up the creek means phoning your bank manager and grovelling, emptying the last of your credit cards, or selling your new computer to pay your only staff member. I’m not kidding, I’ve seen it and it’s the real deal.

At my small publishing company, we’ve found that the bigger the client, the longer they take to pay. Universities and parastatals can be the worst. Recently, a university client couldn’t pay on time because of an internal procedural error, and my contact there told me: ‘Will see what tricks I can pull out the bag’. I’m waiting, trusting there’s money in that there bag. Another client, huge by publishing standards, once paid late because out of tens of bank transfers due that month, one had been entered incorrectly, and as a result the entire payment run had had to be cancelled. (They’re well known for repeatedly paying late.) No one told us about it till I called days later and complained that we still hadn’t been paid. One parastatal took over six months to pay, despite numerous follow ups.

I know that salaried folk — for I was once one too — believe that salaries in small businesses come from the same magical well of money that large businesses draw from every month. That somehow we keep a couple months’ worth of pay aside, just for when you screw up a payment. But the fact is, in a small business every rand is already accounted for before your money hits their account. When a small business is growing, all its available cash must be used to fuel that growth. It’s often foolish to keep sums of cash in the bank when it could be used for furniture or supplies or equipment that the business needs to grow. (The same principle applies to large businesses, but their cash flow can usually be managed over longer periods of time.)

Small businesses usually don’t have the clout to force a larger client to pay more quickly. And there’s no law or ombudsman that’s realistically going to make a difference. So it comes down to you to move that money, Ms Accounts, Mr Clerk. If you want to be a part of boosting the economy, it’s as simple as that. You could make no greater contribution to helping small business grow. Make that payment now.

Author

  • Arthur Attwell is a Shuttleworth Foundation Fellow, co-founder of Electric Book Works and Bettercare, and founder of Paperight. He lives in Cape Town. On Twitter at @arthurattwell.

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Arthur Attwell

Arthur Attwell is a Shuttleworth Foundation Fellow, co-founder of Electric Book Works and Bettercare, and founder of Paperight. He lives in Cape Town. On Twitter at @arthurattwell.

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