There are many reasons why your invoice payments may be delayed: Clients forget, they get busy, or they might not have the money. More often than not, though, clients are prepared to pay for your services—they just lack the patience to deal with poor support or payment processes.
If you’re dealing with delayed invoice payments, here are some tips to get invoices paid faster.
1. Simplify the Payment Process
Not only are paper invoices easily lost, but they also require extra steps for the client to pay their bill. A paper invoice demands that your client open it, keep it, and remember where they put it. Oftentimes, they stash it in a drawer and completely forget that they even owe you money until they happen across it again.
Getting payment from customers promptly starts with offering them actionable reminders and an easy payment method. So, when their invoice comes due, email them instead. Attaching the invoice to an email and including a direct link (or phone number) where they can submit their payment is the most reliable way to get them to quickly take the next step.
Here’s another tip to get invoices paid faster: Email your invoices and offer your support email as the reply-to address, so your clients have an easy direct line to get help in case they need technical support, have a question about their invoice, or need to request a payment extension.
2. Design Crystal-Clear Invoices
In many cases, the reason for a delayed payment comes down to the client misinterpreting their invoice or having a question about the final amount due. This can cause them to put off payment until they get in touch with your support team, which can quickly lead to them forgetting about the bill altogether.
To avoid questions and misunderstandings that result in delayed payments, design invoices that are highly descriptive. Break charges down by line item and make sure to specify hours worked, quantities, and per-unit pricing. Specify any taxes or fees you’re factoring in, too. If the client received a discount, make sure there’s a subtotal and deduction reflecting how much they saved.
Once you redesign your invoice template based on client priorities, you’ll likely see that your invoices get paid faster just by implementing some simple changes.
3. Follow Up Quickly and Often
Ideally, you’ll send your invoice to the client as soon as you deliver the products or services you’re charging them for. Immediately issuing invoices creates a sense of urgency and it gives them the chance to take action while your company is still at the top of their mind.
Following up after sending the invoice is also important, although businesses often fear that they’ll come across as pushy if they follow up too soon. Generally, you’ll want to give your client 3–5 business days to pay the invoice after sending it over before you send another email to remind them.
You can continue to send emails every 3–5 days, but the better approach is to follow up with a phone call if they still don’t pay within three business days of sending the second email. If they don’t answer your call, leave a polite message and send a third email reminder. Some companies will escalate to a written letter after the third or fourth email.
4. Give Incentives To Pay Early
Almost all businesses issue invoices on a net 30 basis, which means that the full amount is due within 30 days of the invoice being issued. In some industries, clients are given 60 or 90 days to pay in full. However, more and more businesses are reducing the time to just 5 or 10 days, especially for smaller invoices.
In addition to making the invoice due sooner, another way to ensure you’re getting payment from customers on time or early is by offering an incentive. For instance, you might offer a client a discount if they pay within X many days. If you need to bill them regularly, you can also provide a discount or other offer for clients who enroll in auto-pay.
5. Make Up for Lost Time
If you feel like a client is dragging their feet or outright ignoring your invoice reminders, you have a few different options as to how to approach the matter. First off, it’s essential that you know your rights as a business seeking to collect a debt. Reviewing your contracts and the laws of your state will allow you to proceed appropriately.
Following up and offering to break the amount due into a few payments might help you get a response from your clients while keeping your relationship intact. Additionally, you might charge interest on the past-due amount after so many days. These are all terms and options you’ll need to lay out in your contracts ahead of time.
If past-due invoices begin to stack up, they can threaten your business’s cash flow and ability to remain open. Avoiding past-due invoices should be your top priority, but having the right partner by your side is another line of defense. For instance, NMA offers services like merchantA business that accepts credit cards for goods or services. cash advances and pre-chargeback mitigation to help you stay in business.
6. Improve the Client Experience
Getting payment from customers becomes easier once you understand why your clients don’t always pay right away. In some cases, it might be that your payment system is slow, or it could be that you only take payments over the phone, which clients find inconvenient.
Asking your clients about how you can improve the invoicing and payment experience can help you get invoices paid faster. Partnering with a merchantA business that accepts credit cards for goods or services. service provider (MSP) who can help you upgrade the payment experience, such as by accepting debit and credit cards, is a step in the right direction.
If you’re looking to get invoices paid faster, NMA can help by providing your business with the tools and support it needs to grow. Aside from tips and tricks, we’ll support your business with low fees, advanced solutions, and highly responsive support that’s tailored to your small business. For more information, visit us at legacy.nationalmerchants.com or call (866) 509-7199.
About NMA
NMA is a merchantA business that accepts credit cards for goods or services. advocacy group dedicated to reducing or eliminating the unnecessary fees associated with accepting credit card payments. Since 2004, NMA’s payment processing solutions have been delivering tailored solutions, best-in-class customer service, and high-quality service offerings for businesses across multiple industries. Whether it’s high-risk or low-risk, brick-and-mortar or e-commerce, NMA will create the best processing experience for your company.