A common complaint heard from business owners is not getting paid on time by their clients. This can feel like a very sensitive subject, one where you feel like you don’t want to be mean or haggle someone. Maybe you are feeling like you want to be understanding, and at the same time you are seething with anger because you feel disrespected!

It’s important to have a client care system that supports both you and the client. This system should include steps that clearly communicates your expectation for timely payment and the procedures that will be taken if the client cannot honor their commitment. This is not about shaming or threatening anyone into paying. It’s about setting clear agreements in the beginning and supporting those boundaries throughout your business relationship.

To enhance your client care and/or billing system, consider adding some or all of the following steps:

Send reminders

Sending a friendly reminder to your client 1-2 weeks before their bill is due is a great way to support those that may be unorganized or having an extremely busy month. You can even set these up automatically within your email provider.

Send a thank you with account statement

Always say thank you for paying on time. Yes, they owe you the money. However, expressing gratitude for payment not only is the proper thing to do, it also encourages timely payments.

If this is a recurring bill, include in the email a statement of account. The statement of account will simply include how much the person has paid thus far and how much they still owe. This eliminates confusion and the “dragging of the feet” when it’s time to pay their bill.

Automatic billing

How about eliminating invoices altogether? In some industries automatic billing may not be possible. But, if you can implement this, it is highly recommended.

To do automatic billing you can easily use a service such as PayPal, Braintree, or your bank’s merchant account service. It’s really simple to set up and all it requires is the client’s credit card or banking account information.

You will be charged a fee each time you clear a payment through your merchant service. However, it is totally worth paying when you can ensure that you’ll receive your payments on time.

Set up supportive agreements in initial contract

Before you start working with a client, you must set up an agreement. In this agreement you will lay out what services they will receive and in turn what payment you will receive. You will also include many other important legalities, but that’s another blog post.

For now, I want to focus on some things to include to set clear expectations for timely payments.

Make sure that you are setting guidelines for the following:

  • How much are you expecting in payment and how often?
  • Is there a grace period before their payment is considered late?
  • Will there be a late fee if the payment is late, how much will it be?
  • What procedure will you follow for rejected payments?
  • What procedure will you follow for clients that are consistently late?

Now that you have your guidelines it’s important that you follow them! In order for boundaries to work, they have to be clear, fair, and enforced.

Treat others the way you want to be treated

It’s important that you are operating in your personal and business life the way you are expecting your clients to operate with you. Are you paying your bills on time? Are you honoring your agreements?

In order to have what you want, you must ensure that you are doing the same. Because, you will attract clients that are just like you. **I’m not saying that if you have rude clients that means you are rude!!** No, what I’m saying is that you cannot ask someone to do something that you are not doing yourself. It’s called karma. So, create good business karma by honoring and respecting your fellow business owners.

_________________________________________

These are some of my tips to ensure timely payment from your clients and customers. What steps do you have in place within your client care system that work for you? Share your steps in the comments below!

 

 

Pin It on Pinterest