One of the best things about running your own business is having the freedom to be your own boss and follow your passion to its fullest. But, like with everything in life, it has its challenges too. One of the most common problems small business owners face is getting paid on time. In fact, according to a survey by Hubspot, 49% of small and medium businesses find it challenging to follow up on late payments and 46% find it difficult to get paid on time. This can cause real issues for your cash flow.
But here’s the good news: Getting paid on time is easier than you think. You just need the right tools and approach. Here are the top five tips for getting paid on time by your clients and customers.
1. Be Clear With Your Invoice Terms & Conditions
Whether you are a freelancer, service-driven business, or a business that supplies products, it’s extremely important to be crystal clear about your invoice terms and conditions. On your contract with a client or partner, you should include a clause about the time window in which you must get paid after delivering your services. You should also reiterate these payment terms on the invoice template itself.
This can be a really simple and powerful strategy to add to your invoicing if you are using an invoicing platform like vCita. Below is an example of how to define and customize your invoice terms and conditions.
2. Enable Multiple Payment Systems
If you want your customers and clients to pay on time, you must make it easy for them to pay. The best way to do this is to enable multiple payment systems or to use a payment processing service like PayPal or Stripe that allows customers to pay using the bank details or a variety of different credit and debit cards.
Paypal is one of the most popular and flexible payment processing services. It’s especially useful if you have international clients and customers and want to accept different types of currency. Stripe is a similar service. Below is an example of how to begin accepting PayPal or Stripe using vCita as your invoicing platform.
3. Stay Organized
Most customers and clients are responsible and want to pay you on time. But are you organized and invoicing them on time? If you want to get paid on time, the process must start with you. You need to find an organized way to know when to invoice your clients, when the invoice is due, when it has been successfully paid and when it goes into default (unpaid after the time period you defined).
One of the best ways stay on top of all this information is to combine your CRM solution (customer relationship management) with your invoicing solution. One of the best ways to manage the two is with vCita. At a glance, you can organize all of your invoicing and sort through what’s been paid and what is overdue.
4. Send Reminders & Invitations
Your customers and clients likely have the best intentions to pay you. But perhaps they just need a friendly reminder. When it comes to soliciting a payment, especially one that is overdue, remember to always take a polite approach. You don’t want to assume the worst or start a conflict that could really deter the client from paying you. Instead, you can send a timely and non-intrusive payment reminder SMS or email.
Both SMS and email are a direct line to your client that they can review on their own time. It’s not as demanding as a phone call, and even better, it can link to a direct way to make the payment (which you can’t do on the phone unless you ask for their card details). Most people are hesitant to share their payment details over the phone, and prefer to pay online for added security. Make this easy for them by sending an SMS payment reminder or email payment reminder. vCita offers a way to do both, as seen below:
5. Offer Incentives
Another strategic way to get paid on time is to offer your customers and clients payments for paying on schedule or to settle an overdue invoice. The opposite would be to penalize customers and clients for not paying on time, but that can create conflict or deter customers from doing business with you from the outset. Instead of charging, you can positively encourage the importance of paying on time by offering incentives. For example, let clients know that they will earn special offers or loyalty points every time they pay an invoice on time. You can use the same strategy to motivate clients to pay an overdue invoice by offering to reduce the price by 5 percent if they settle their payment within five business days.
To Sum Up
When it comes to getting paid on time, both you and your customers and clients share this responsibility. However, it is in your interest as the business owner to make it as easy and pleasant as possible for your customers to pay you. That means accepting flexible payment methods, invoicing them on a regular schedule that they can anticipate, and taking an innovative approach to resolving overdue invoices, like offering incentives instead of penalties. But one of the best things you can do is use a payment invoicing solution that merges seamlessly with a CRM solution. With these two services combined into one platform, it’ll be easy for you to identify who among your clients needs to pay you and look up their contact info at the same time. One of the best platforms for these two services (and more) is vCita, we highly recommend checking them out!