Ideally, your business is contracted to do a job, the job gets done and payments from your clients arrive within the agreed upon time. Unfortunately for contractors, freelancers and small business owners, this isn’t always the case. Expectations of being paid on time are not unreasonable, especially when late payments can cause small business owners to fall behind on paying their own expenses, possibly even causing permanent damage to their company. To help ease any potential headaches, there are a few simple things you can do to make sure payments arrive on time.
Setup payment expectations
Inform your clients of not only the cost of the work, but also what the payment schedule will look like, including when final payment is due. Ask to receive, if possible, at least some of the payment owed upfront. If you’re organized, straightforward and equipped with a service contract from the beginning, your clients won’t be able to justify an excuse based on unclear instructions. This will allow you to mitigate any issues that may come up in the future. After both parties are confident that the terms have been clearly communicated, you are much more likely to meet your payment expectations.
Reminders can also do wonders for both you and your client. Life is busy and sometimes we forget the most important of things on our to-do list, even getting paid. You can always send a pleasant reminder to your client with the payment due date and amount owed once the job has been completed.
Don’t hesitate to reach out to your clients if you haven’t received payment within three business days after sending an invoice. Clients, like you, are busy and may have overlooked the processing of a payment, especially the first one. Send a friendly notice a few days following your initial invoice date. In addition to following-up, you should make the payment process as easy as possible. There are plenty of online tools, such as PayPal, that will help you and your company collect payments with less effort. Remember, the less time it takes your client to make a payment and the easier the method, the faster you’ll get your money.
Send invoice to correct person
What seems obvious isn’t always necessarily brought to fruition. It is crucial to get your client contact information correct. Although this is simple, simple mistakes can happen. Be sure to send your invoice to the correct person with his or her name spelled correctly, including the right billing address. Whenever there is a financial discussion with your client, be sure to cover all of your bases. It takes two minutes to verify who’s making the payment and when it is due, which can save you much needed time in the long run.