“If you go above and beyond for a customer, you deserve to be paid quickly. When the payment is due, the main disappointment for a small company owner is when those expectations are not reflected by the client.”
No one likes chasing down clients for money, yet it occurs very often in business. Nonetheless, small firms usually make the effort because late payments may affect cash flow and risk a company’s financial stability. We know that convincing client to pay invoices is a major pain point in the services business, from late payments to non-payment.
It doesn’t have to be this tough for you or your company to get a client to pay their payment on time! In this post, we’ll look at seven different ways to convince your client to pay an invoice on time.
How to Get a Client to Pay an Invoice on Time?
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Specify Clear Payment Terms
The first step is to clearly communicate your payment conditions to your customer. This should be clearly documented, preferably in a contract.
Your clients may make false assumptions regarding payment conditions from time to time. They might assume you operate on a net 30 basis or expect payment on specified dates, such as the first and fifteenth of each month.
Include a contract section that explains payment methods, deadlines, and other relevant data. When negotiating on this document with your clients, find out if they want a specified invoice format or if they prefer to use an in-house mechanism for payment.
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Get Upfront Payments
A contract to pay half of the bill at the start of the project and another half after completion is a mark of good character and an indication that you will be paid after the task.
Consider revising your invoicing procedure so that you get the payment before work is completed. You can make an agreement that states you will complete specific tasks as soon as payment is received on the first of every month.
You can then do the task after getting paid, modifying the process to your favor. Many clients also prefer to pay an invoice in advance so that they are not bothered later.
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Reward on-time and early payment
Give your clients the motivation to pay attention to your invoices by offering a discount for on-time payments. Rather than punishing your clients for being late, this cash incentive encourages them to be on time.
Although you should charge interest for missed invoicing deadlines, promote the positive choice first. Your business can provide a fixed discount percentage, such as 5%, for any upfront or on-time payment. Another method is to use a sliding discount scale, which starts with a large discount and gradually decreases as the invoice due date passes.
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Automate Your Payment Process
Take your invoicing process to the online procedure and send electronic invoices to speed up invoices’ receipt.
Sometimes you might not get paid because you didn’t send out your invoices to customers. So, if you usually forget to send out invoices, use an automatic invoicing system to send out your bill after work is completed. Use a system that will automatically deliver the invoice after the job is completed or the products are shipped. When you automate your invoicing, your client may pay an invoice in 1-2 days.
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Send Pleasant Reminders
Set reminders in your calendar about when you need to follow up with clients regarding payments. Don’t be scared to write an email; clients frequently become busy and forget. They’ll be thankful for the reminder. A pleasant reminder also shows them that you’re a professional who stays on top of things.
You can send out an email a week before the invoice is due. Follow up with a phone call if you haven’t received an answer within a couple of days.
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Incorporate Payment Links Into the Invoice
Clients may plan to pay right away, but they need to first open another application or web tab, log in to their accounts, and then transfer money to you. There is a chance that they will be taken away from the computer and have their session time out before they may come back. The clients do not want to redo all the steps, so they postpone it until the next time. This situation repeats itself a few more times and you become annoyed with their lack of response.
Add payment URLs or buttons straight into your invoice if your invoicing system allows it. Your clients are only a click away from paying an invoice. It lowers the possibility of any diversion pulling their attention away from the task at hand. Make this process as easy as possible.
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Maintain good client relationships
A client that likes you will pay you immediately!
When you spend time getting to know each other, you build up trust and respect. You also understand that you need to keep your end of the deal. This personal interaction with clients also makes it easy to pick up the phone and request payment when required, as well as avoid any confusion that can delay payment.
THE BOTTOM LINE
Not every tip will be helpful to every client. Use these ideas with your current payment system to maintain great customer connections while reducing financial stress. Try different strategies to determine which ones produce the best outcome to convince a client to pay an invoice on time.
In an ideal world, invoices are paid as soon as they arrive at a client’s desk. In reality, you could use some financial assistance to maintain a steady cash flow.
At Hasanov Capital, we can help boost your small business growth with a working capital loan or one of our other small business financing options. We are specialized finance and alternative funding platform that is privately owned and operated. We focus on providing capital access to small and mid-sized enterprises in the United States who have typically been neglected by traditional financial institutions. And the ones who may have had trouble receiving timely funding. Get in touch with us today!
