Last Updated on Apr 1, 2020 by James W
A location-independent business may offer plenty of benefits – but chasing clients for timely payments is certainly not one. On several occasions, receiving payments requires more than emailing an invoice and then waiting for money to arrive in your bank account.
Sitting tight and keeping your fingers crossed for swift payments, however, is not a viable strategy if you’re looking to optimize your cash flow. You also have to pay for services and subscriptions, so you risk defaulting on things that keep your venture afloat if you don’t receive the funds on time.
Your clients will always have the upper hand when it comes to quick payments. You can, however, speed up the process by implementing these tried and tested tips.
1. Set up Reminders
Modern recurring billing software allows you to get outstanding invoices cleared with retries of failed charges, alerting of required actions, and payment reminders. You can also leverage other features to create an unlimited number of custom billing schedules, including metered billing, installment plans, flat rates, and more. By utilizing these options in a recurring invoicing solution, you can save time, satisfy clients by automating recurring dues, and get paid sooner.
2. Be a Professional Figure
Professionalism isn’t just important to build your credibility in the industry, it can be the key to getting paid quickly. If your communication with clients is impolite, your work is sub-par, and you provide a service that screams the work was outsourced, then clearing your invoice might not be a priority for your clients. Always be polite, share testimonials and exceed goals to show that you are a true professional who justifies the investment made in his/her services.
3. Provide Several Payment Options
It’s a given that you’ll receive late payments if you’re only accepting checks. It’s a long process because they first will arrive by snail mail and then deposited in your bank account. Therefore, always provide multiple payment options to clients. Whether it’s creating a PayPal account or accepting eChecks, you need to make payments convenient to get paid faster. Most billing software solutions enable you to set up multiple payment options, and you even have a way to set up one-click payments. Options like Square card reader are also available to accept credit card payments over the phone or in person.
4. Give Incentives to Get Paid Promptly
Going a step further, you can offer incentives to clients if they pay early. Tell them in your initial communication that faster payments are associated with a discount; this could encourage clients to let go of procrastination and send the payment your way. Of course, you’ll lose money by giving discounts, which is why the discount should always be small (1-5%). It will save you from the headache of chasing clients, and the time you save can be given to providing services and earning greater income.
5. Get Invoicing Right
How many times has an invoice been sent back to you because it didn’t include all the details the client had requested? Perhaps you’ve also faced a situation where the client wasn’t informed by the finance department that a specific detail is required and you were requested to regenerate the invoice. To avoid this from happening, check with clients if there are specific requirements for the invoice to be processed. This could be listing a vendor number, a tax ID, a Purchase Order, or another thing of a similar nature.
Waiting for payments is a stressful situation. Freelancers depend on smooth cash flow to keep things going and not having a particular timeframe for invoice clearance is a great challenge. These measures, hopefully, will help you turn things around.