7 Tips to Get Paid Faster
Hi, my name is Adam Stewart, Debt Collection Expert and owner of Debt Recoveries Australia. I love credit control and all things related, so it’s always exciting for me to talk to clients about how they manage their accounts receivables and picking up some tips along the way.
Cash flow is king and there is nothing more important that getting paid as fast as you can. So here are some of the tips on getting paid faster that I have picked up from my clients and also some that we have implemented ourselves in our office. I hope these can be of benefit to you for better credit control.
Use the right tools.
First and foremost, if you aren’t already completely paperless you should try your best to move toward it. By sending, receiving, and managing your invoices online you will surely save yourself time and money. There are plenty of online payment platforms out there that will solve your billing issues with ease.
Here are a few that I can recommend:
- Due: Due is an online invoice, time tracking, project management and credit card payments platform designed to help companies of all sizes with its scalable solution.
- Freshbooks: Freshbooks is small business accounting software that offers features like invoicing, expenses, time tracking, payments and reporting
- Quickbooks: Quickbooks is a full-service accounting platform that also provides tools for invoices, online payment, and financial analysis.
- PayPal: PayPal offers a simple and effective invoicing tool that has some customization and provides for online payments from customers and clients.
- Xero: Xero offers easy online payment where your customer can simply click on the link sent to them and pay online using credit card or Paypal.
Charge interest and penalties for late payment.
If you aren’t already charging interest and penalty fees on late payments, you absolutely must begin. Late fees add urgency to invoices, ensuring they don’t end up at the bottom of the bills-to-pay pile. Be sure to reference late fees in the initial customer contract or credit application form and again clearly marked on your invoices.
Let your clients know exactly what the fee percentage is and when it applies (i.e. a two percent interest fee will be charged per month on late payments plus debt collection fees and/or legal fees). This lets the customer see what additional payments they would have to make if they don’t get that invoice in on time.
Provide incentive for early payment.
Beyond motivating payment with late fees, try providing a discount for your customers to pay you early.
Incentives might include a 1 to 2 percent discount if payment is received within a specific “early” time frame. Include these incentives in the invoice so the customer is immediately motivated to react to the offer.
Also, consider offering future discounts, credits, gift certificates or merchandise as possible incentives.
In the end, you’re saying thank you for making that payment a priority. It’s rewarding your customers for their business, increasing their loyalty, and helping you get paid.
Include electronic payment options.
You will see a much quicker response when you give customers the opportunity to pay electronically.
Not only can this help you get paid, but electronic payments can save you time and administration in processing checks and money orders. This also helps reduce fraud as you will have an electronic “paper” trail.
Send invoices by email and online.
Make sure you are NOT sending your invoices by snail mail. This is un-economical, time wasting and very old school. Your customers will probably take advantage of your old school practices and put you to the bottom of the payments list.
Many software packages allow you to also send online invoices your customers so that the customer simply clicks on a link you send them, then click on a Pay Now button.
Your customers don’t even have to think about when or how they’ll pay you — they’re likely to pay you immediately. In Xero, for instance, online invoicing is already set up for you.
Invoice as soon as possible.
It goes without saying that the sooner you invoice, the sooner you get paid. Get into the habit of invoicing as soon as you complete work, rather than waiting until the end of your accounting period.
Outsource to a Debt Collection Agency.
If you implement all these tips and give your customers 30 days to pay and they still do not pay, make sure you immediately outsource to a reputable debt collection agency, such as Debt Recoveries Australia.
Why try and handle these debts yourself when your agency can do all the collection work, then on-charge the collection fees and/or legal fees to your customer? It’s a no-brainer.
Debt Recoveries Australia is the expert at recovering your outstanding debts without the drama. We are also providing free templates for you to use on your debt collection. For more details, email us at firstname.lastname@example.org or call 1300 799 511. Tell us your concerns on Skype at “debtrecoveries”.
Photo credit: Money vector designed by Freepik