The holidays are coming. They are an excellent time for many businesses as people are on the hunt for gifts and anything else that can brighten their lives and homes during this festive season. While you’re probably already preparing for the boost in business, there’s another thing you need to take into account. The holidays also bring with them mail delivery delays and USPS recently estimated November 9 as the final deadline for Priority Mail and First-Class Mail to arrive before Christmas.
While this situation is beyond your control, it doesn’t mean your vendors will be willing to wait as long as it takes for your checks to arrive in the mail. After all, they have bills to pay too, and late payments are a real issue for any business.
4 ways to avoid late checks this holiday season
While you can’t magically reduce demand for postal services during the holidays, luckily there are a few things you can do to make sure your vendors are paid on time.
1. Switch to ACH
Perhaps the easiest solution is to just switch to a more efficient payment method. Call your vendor up and explain the mail situation urging them to accept a transfer instead of a check, at least this once.
In normal times, checks can take around seven days to arrive in the mail and much longer during the holiday season. An ACH bank transfer, on the other hand, will take just a few business days to process and comes with instant confirmation you can provide your vendor with. They’re also safer than physical checks as ACH transfers cannot get lost or stolen on their way to your vendor.
Oh, and if you use a service like Melio, sending an ACH bank transfer is free so you’re already saving on fees as well as the hidden costs of checks.
2. Use the opportunity to ask for an early bird discount
If your cash flow situation allows you to pay sooner, check with your vendor to see if they’re willing to offer a discount in return.
This is a win-win: Your vendor enjoys an early infusion of cash during the demanding holiday season, while you get to save money and improve your relationship with them.
3. Take a road trip
If you’re working with local merchants (which is never a bad idea) you can take the opportunity to deliver the payment in person. Taking the time to meet with your vendors face-to-face once a year can do wonders for your relationships with them.
It can also be a chance to see how your goods are manufactured or handled before they arrive at your door and ensure everything is up to your high standards.
4. If all else fails, use express delivery
Sometimes there’s no escaping it. Despite your best efforts, your vendor insists on getting a physical check like they always did, and is geographically too distant for you to deliver it in person. This is what express delivery services are made for.
Express services will obviously cost you a bit extra, but that’s nothing compared with the potential damages of late payments due to mail delays. These damages include late fees, possible litigation, and worse of all, damaged relationships with vendors. Spoiler alert: they'll cost you more than a couple of Hamiltons.
Spread holiday cheer by paying your vendors on time
Caroling is nice but timely payments are an even surer way to bring a smile to your vendor’s face. While the holiday season is generally good for business, it can also be very stressful. So, take one load off your vendors’ shoulders by making sure they get their money on time.
If you’re looking for an easy and cost-effective way to send an ACH bank transfer or a fast check, sign up for Melio today.
*This blog post is intended for informational purposes only and is not intended as financial advice.
**Melio does not provide legal, tax or accounting advice, and you should consult with a professional advisor before making any financial decisions.