I am current reading ‘The Lonely Planet Story’, by Tony Wheeler. I am still at the start of the book where they are still getting their business established. Like many starting businesses they had serious cash flow problems. He had to call around to bookstores reminding them to pay their accounts.
It got me thinking how great the affiliate business can be. I make my money through a variety of affiliate programs. Each month, if I have made the minimum level they either send me a cheque in the mail, pay into my Paypal account or bank account.
These companies probably automate these tasks, so I receive payments usually around the same time each month. I am sure that there are some scrupolous operators out there, but you can be sure they won’t last long. Good internet companies know the value of keeping their affiliates happy.
Many affiliate marketers run blogs and chat on webmaster forums, so if a company that doesn’t pay on time or inaccurately you can be sure people will be talking about it all over the internet. Think back to the problems Chitika had when they started up.
If I work out any deals directly with advertisers, I make them pay up front. Costs are low, resulting in regular, positive cash flow.