Getting clients to pay their invoices on time is one of the great banes of every business owner’s existence.  Your clients’ prompt payment ensures that you don’t experience an interruption to your business’s cash flow. Without it you are forced into a state of limbo, unable to purchase more equipment, hire someone if necessary, or simply be paid for the work you do.

So how can you ensure that your clients will be more willing and able to pay you on time? Check out these 10 strategies:

  • Invoice quickly.

As soon as the service is rendered, send the invoice to your client right away. This sets payment expectations you have for the client. To ensure that your client has received the invoice, request a confirmation of receipt.

  • Steer clear of disputes with estimates.

Ensure that you provide your client with a thorough estimate of the service or product you offer before you begin or ship it.  Include prices, deadlines and payment terms. This will avoid any disputes.

  • Follow best practices on invoices.

Provide as much detailed information about the product or service as possible. Anticipate any questions and make sure the payment terms are clearly featured at the top of the invoice.

  • State clear and consistent payment terms.

Indicate payment terms and the time frame in which you accept payment on the invoice. The standard time frame is 30 days.  However, you should be able to get paid quicker if you accept credit card payments.

  • Have a variety of payment terms.

One way to encourage clients to pay faster is to require a deposit, with the remaining amount due on delivery. Another option is to require payment when certain project milestones are reached or when expenses are incurred.

  • Provide multiple forms of payment.

You will increase your chance of receiving a prompt payment if you accept credit card payments, digital payments, and checks. Payment technology is changing fast, making it easier to set your business up to take credit cards.

  • Have a consistent plan for follow-up

Your payment terms will guide your first step in retrieving your unpaid invoice. You can send a reminder email or make a friendly call to remind your client. You can also use accounting software to automate the payment reminder process.

  • Leverage your products and services.

If a client consistently falls behind on their payments, consider withholding a portion of their work until you get paid. You can also refuse to work on new projects until payment is received or a satisfactory payment plan is established. 

  • When to hire a collection agency.

If you pursue them for months on end, without a result, then hiring a collection agency may be the next step. Do know that they take a 30% cut and this could spell the end to your client relationship.

  • Keep the client relationship professional and friendly.

It’s a tricky balance, but try to convince the client to feel not just that they have to pay, but they want to. Also, be empathetic to those who are struggling to pay. Find a way to partner with them, to make it easier for them to pay.

Ultimately, it’s about preserving the client and business owner relationship

At the end of the day, it’s about establishing a partnership with your client so that they see that you care about your working relationship. Focusing on this will build stronger bonds, and in time, a more successful business.

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