6 Ways to Get Paid Faster and Keep Your Business In the Black
6 Tips on Getting Paid Faster
- Document your payment terms. Make sure your payment terms are clearly noted on all invoices and are simple to understand. To take it a step further, you can add a “Payment due by XX” line to ensure there is no misunderstanding.
- Invoice Consistently. Invoicing on a specific day or date each month can help get paid faster. Whether sending invoices out every Monday morning or on the 15th of every month, remaining consistent will help keep your payments on track. If you do a lot of project work, invoicing as soon as the work is done, improves chances of payment because the value of your work is still fresh in the mind of the customer. Web based applications, such as Freshbooks,Quickbooks, Paymo and Zoho Invoice allow you to manage and send invoices, even on the go!
- Invoice Correctly. The last thing you want to upset the customer with an incorrect invoice. Ensure that you have billed the customer correctly. Give a detailed breakdown of the services rendered or products delivered to ensure that the clients understand exactly what they are paying for. Also, address the invoice to the right person in the organization to ensure that your invoice reaches the right desk.
- Make it easy for them to pay. If you want to get paid faster, then make it easy for your customers to pay you. Accepting payments through services like PayPal or bank payment services like Chase QuickPay, allow clients to pay you with a click of the button and the monies are transferred directly to your account with either no or minimal fees. If your invoicing service offers the ability to collect payments via credit card, like Freshbooks or Quickbooks, with a minimal charge, the small cost might be offset by the convenience to the customer and you'll see payments quicker.
- Be creative and flexible. Evaluate if you can afford to give clients an incentive for early payments. For example, ‘Pay within 10 days and avail a 5% discount on the bill value’. Alternatively, offer freebies or discount on future work for early full payments. Be open to terms your customers may offer. For instance a client may ask for a reduction of 2% in the bill value in exchange for paying by wire transfer by the 30th.
- Focus on relationship building. Customers are likely to prioritize your payments when they like you. As per Freshbooks, an online invoicing company, adding ‘please’ or a ‘thank you’ can increase your likelihood of payment by 5%. You can send out email payment reminders, but if the person clearing payments doesn't really know you, they might overlook the reminders. Pick the phone and speak to the person in-charge. If the customer has missed a payment date, don’t use harsh words or threatening language. A reasonable approach will be less stressful for both of you and can save the business relationship.
At the end of the day, getting paid on time is greatly determined by your ability to make customers happy with consistently good products and service. Conveying sincere gratitude for their business and following invoicing etiquette shows you’re a business who keeps their customers interests at heart and that is bound to be good for your business.