A receivable cannot be used to help grow or sustain your business until it has been paid. Most reputable companies consistently pay on time; however there are some that just can’t seem to stay on top of it, regardless of their good intentions. This article will give you some powerful tips to help you turn your invoice into a payment quicker, so you can reinvest it back into your company.
Here are five simple steps to getting paid faster:
1. Create a detail estimate for your client to sign off on.
Make sure that there is an established quote with a clear breakdown of the charges that the client has approved, so there is no doubt about what is due. This same information should appear on the invoice, so they can see the details of each charge. If you used client billing software to create the estimate, you can quickly turn it into an invoice without having to re-enter the information.
2. Negotiate better terms upfront
You can always offer incentives for faster payment or negotiate interest for late payments in advance, to inspire clients to pay a little earlier. Most companies will appreciate a 1-5% discount for paying in 15 days versus the typical 30 days standard terms. There should also always be a note on the invoice that interest will be charged after a specific period of time. You do not need to ask for interest within the first 60 days, but after 60 days it is a reasonable request.
3. Send the invoice as soon as the project is complete
It only makes sense that the sooner the invoice is in the client’s hands, the sooner it can be paid. If you use client billing software, you can quickly generate the invoice and email it directly to the client. This software usually offers a read receipt, so you know the moment the client has reviewed it. Online client billing software is also more convenient, since you can create an invoice from anywhere with internet service.
4. Offer several payment methods
It is important that you offer your clients an added convenience by giving several different payment methods they can use. These choices should be indicated somewhere on the invoice close to the total amount owing. Some clients will still send the check in the mail (which always add to the wait time), but others may choose to use an online payment method like Paypal. Being able to offer fast payment options is one of the best ways to make sure you get paid sooner.
5. Send a professional reminder notice
Sometimes all it will take is a polite and well-written reminder to move your invoice to the top of the heap. Client billing software programs are usually setup to automatically send a reminder prior to the invoice being due. This should certainly improve the chances of getting paid on time.
All it takes is a clearly defined quote, favourable terms that were negotiated in advance, online billing software to send the invoice immediately to the client, a choice of convenient payment methods, and a professional reminder notice before it is due to ensure that you get paid faster.