One of the biggest problems that businesses have is chasing customers for payment. There seems to be no end of excuses for why money is not forthcoming.
This can be a big problem for businesses for obvious reasons. Many clients don’t seem to realise that for businesses, cash is king. They need to get the money in to pay wages. And waiting around for customer payment means that they are going to have cash flow issues.
With that said, what can you do, as a business, to get paid on time? Here are some awesome hacks.
Be Clear On Your Payment Timeline
One of the mistakes that a lot of small businesses make is not making clear when payment is due. But putting down a specific date by which the client should have paid is an excellent way to generate urgency. If payment is required within 21 days, let them know that this is the case. You need to convince the client that they have to pay you on time, just as they have to pay their gas and electric on time.
One of the ways that you can do this is the copy the type of language that large enterprises use on their bills. They create a sense of urgency by using formal language and being clear exactly when the payment is due.
Being clear on invoices about how you arrived at a particular figure can also help speed things along. When a customer knows exactly what they’re paying for, they’re more likely to make a payment.
Remind Customers That They Need To Pay
You would hope that once you had billed clients that would be enough to secure payment. Unfortunately, it still might not be and this might cause a delay in payment.
That’s why it’s a good idea to send out invoice reminders. Many small business owners feel awkward doing this sort of thing. And that’s not surprising: asking people for money is never easy. But reminding people that payments are due is sometimes helpful: customers may have forgotten.
Of course, sending out reminders is a time-consuming process, so if possible, use software to do it for you.
Use Electronic Payment
Integrated payment processing has come a long way since the dawn of the internet. Some software now allows you to attach a card payment option to your invoices for quick payment.
But nothing beats having an actual terminal. In some ways, it’s a psychological thing. People are just used to paying out money whenever they see a terminal. They do it all the time without even thinking.
The secret, as a small business, is to cash in on some of that cachet. Most small businesses should be able to find a bank to provide merchant banking for them. And that means that most small businesses will be able to use a payment terminal to accept payments.
Having a payment terminal is especially useful for firms that interact with clients face-to-face. Instead of sending an invoice at a later date, or asking for cash, just say that you’re willing to take card payment. You’ll be amazed at how quickly you’ll be paid.