Polite Promotions

Polite Promotions — the promotional staffing agency providing brand ambassadors, promo staff and event managers for marketing campaigns — certainly lives up to its name. Not only is the company one of the most engaging marketing firms you’re likely to come across, but head honcho Ryan Connolly is a nice guy to boot.

“For us, it’s all about staffing”, says Ryan. “We have around 2000 casual employees across Australia. They are the core of our business”. Ensuring those staff get paid on time is what led Ryan to CreditorWatch Collect.

Making sure his workforce is happy and well looked after is a huge part of Ryan’s day; but historically, achieving that has been easier said than done. Over the course of the company’s five year run, Ryan has felt the pressure caused by irregular cashflow more than once.

Cashflow was a “major headache”

“Cashflow issues have been a major headache for us”, he says. “We really, really value our staff and want to keep them motivated, and one of the ways we do that is by paying them fortnightly, but that can be tricky”.

“We have seven-day payment terms for our clients, but that hasn’t always held”, he says. “In the past, clients have been known to push that out to 90 days sometimes, which is probably a symptom of the way we were tracking our debtors. If they didn’t have any attention from us, often they simply wouldn’t pay”.

“So while every fortnight we have that looming wages bill, we don’t necessarily have clients paying their invoices. You pay your wages, your cashflow goes down and you spend that first week pedalling hard just to make sure you can pay that next bill. It’s a  pay, chase, pay, chase cycle”.

“Chasing [invoives] can eat up a lot of time”

A little analysis revealed which types of invoices which were in fact causing most of the headaches:  “If someone owes the company $100K of course we will have a good handle on that and can manage the expected payment”, says Ryan. “But  it was the multiple smaller ones that were causing us the problems. There are a lot of them and chasing them all can eat up a lot of time”.

“Before, chasing debtors was a fairly chaotic process and quite time consuming”, he says. “Now, we probably spend 15 minutes a week sitting down with the team to highlight the really important invoices, and the rest we just leave to CreditorWatch Collect”.

The company would spend “hours and hours” a week chasing invoices, and “countless hours more worrying about it”, and during the holiday period, the strain became almost too much to bear.

“Over the Christmas period we usually have a spike in staffing numbers, which is great of course, but we also have clients pushing for longer terms or just going silent for a number of weeks, which can be a real problem”.

As Christmas rolled around once more, Ryan decided he’d had enough and downloaded CreditorWatch Collect from the Xero Marketplace, spent “perhaps 30 minutes setting it up”, and left it to do its job.

After four months running CreditorWatch Collect, Ryan credits the app with producing huge time savings, efficiency improvements and a radical reduction in invoice-chasing stress.

“Before, chasing debtors was a fairly chaotic process and quite time consuming”, he says. “Now, we probably spend 15 minutes a week sitting down with the team to highlight the really important invoices, and the rest we just leave to CreditorWatch Collect”.

“The great thing is that it prompts not only the client, but me too. Just having those gradual, steady reminders there — we’re definitely in a better position because of that”.

And not only does CreditorWatch Collect allow Ryan to keep his staff happy and cashed up, his clients are happier too.

“We use a really soft approach here”, he says. “Cashflow is a concern purely because we value our staff and want to pay them as soon as possible, but we really appreciate our relationships with our clients too, so we want to chase those invoices effectively without burning our relationships. CreditorWatch Collect lets us do that”.

The numbers don’t lie

When Ryan started with CreditorWatch Collect he had $617k in invoices owing to him and, on average, 46 days of sales outstanding. This was eating up his cash and putting pressure on his cashflow. In effect, he was acting as a bank to his customers.

In less than two months, thanks to CreditorWatch Collect, Ryan reduced his 48 days of sales outstanding to just 29 days. That means he now has an extra $228,000 in his bank account, cash that he can use to reduce debt or spend on building his business. Put another way, for each day’s reduction in sales outstanding, Ryan gained an additional $13,711 in his bank account, money that would have otherwise been in his customers’ bank account.