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One of the most difficult things for businesses is when clients do not pay on time. This is especially in the current day and age when businesses are struggling because of the coronavirus pandemic. So, how can you get your clients to pay on time? Of course, you cannot force someone to put their hands in their pockets. However, there are some steps that you can take to encourage this.
The first step you need to take is to automate your invoices. There are companies like OnPay Solutions that can help you with this. Automating your invoices will ensure that they are ready to be sent out as soon as the work is completed. This is important because it encourages clients to pay on time. One of the reasons why invoices are paid late is because they are sent out late. You can make sure that this does not happen by automating your invoices.
It is vital to make your payment terms clear. They should be printed on your invoice, and you should let clients know that this is the case. If you have recurring clients and you are about to put payment terms on your invoices for the first time, make sure you let them know. Do not simply spring this on them by surprise.
You can easily sent your payment terms before you start working together in your client intro + welcome package.
Another way for you to make sure your clients pay on time is to charge interest when payments are late. No one is going to want to pay more money than they need to for a service, so the prospect of being charged interest is something that can encourage clients to pay in a prompt manner. This is not something that you can spring on clients out of the blue. You cannot enforce interest on invoices that have already been sent either. You need to make sure that your clients are aware that interest will be put in place in the future, and then adhere to this.
Last but not least, the final thing you need to do as a business is to make sure you chase any payments that are late. You should chase them at the earliest opportunity. The sooner you get on the ball, the better. Don’t only follow up with emails, but call the office or the individual as well. If they are based in close proximity, you can also pay them a visit. This is something you can do if numerous emails and phone calls have been ignored. It is not really necessary to visit someone’s office if they are a day late on a payment.
You can use automation services like these to send out automated email sequences to remind the client automatically without the fuss of emailing them yourself. Just create a new automated sequence (that sends out payment reminders every 10 days for example) and keep them in the sequence as long as they haven’t paid. When they’ve paid – simply remove them from the sequence.
To conclude, there are a number of different ways that you can encourage your clients to pay on-time. If you follow the advice that has been provided in this guide, you should notice a positive impact with regard to your cash flow and clients paying invoices on time.