I’m a big fan of using outside contractors and vendors when you’re first starting a company or even when you’re launching a new product or service. Until you actually know what you have and you’ve got a good read on product/market fit, there’s really no reason to fully invest in internal resources. I mean, you certainly could, and many companies do, I’ve just always found it easier to initially start with outsourced resources.
Cash is king when it comes to any small business. And even as a company grows, understanding the impact of free cash flow on the underlying value of an organization is critical. So, making sure you’re staying on top of how much cash you have, or how much you’re generating, is imperative. If you own your own company, my guess is that you’re looking at your cash flow on at least a weekly, if not daily, basis. For awhile, I was checking the Rivet & Sway books daily!
While I’m a big fan of maintaining cash, I’m also a big fan of paying vendors and contractors on ‘due upon receipt’ terms…even if they’re not asking for it. Now, I’ll never pay vendors or contractors up front (and if you ever have somebody ask you for money upfront that’s a clear indication to run…..unless there is truly a reason why they need that money in order to do the job for you), but I will pay as soon as I receive their invoice. Why? As a startup or small company, I believe it’s good practice to pay service providers upon receipt. It builds goodwill with your company, differentiates you from other companies that are using vendors, and provides the ‘surprise and delight’ feeling that you need to be delivering at every brand touchpoint. And most importantly, it will turn your service providers into evangelists.
The ‘customer experience’ doesn’t just start or end with the end customer. It’s truly an experience that you live by across all of the touchpoints of your company. Be it a vendor, a banker, a trade show, your kids elementary school teacher…doesn’t really matter….just think of the different ways in which you can delight anybody who comes across your brand.
The key takeaway: If you’re just starting, you need any goodwill you can find. So pay your service providers once you get the invoice. You’ll be amazed at how they perceive their experience with you and what they can do to help find new customers.