6 Proven Tips To Get Your Clients To Pay Their Bills On Time
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Published on: 25 October 2022
Last Updated on: 11 November 2024
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If you’re a freelancer or small business owner, collecting payments can be one of the most frustrating parts of being in business.
But if you want to keep your company afloat and make sure that both you and your clients get what they deserve, it’s worth taking the time to follow these tips for getting paid on time.
Keep reading!
1. Have Multiple Methods to Pay
These ways allow your clients to pay their bills:
| Credit card: Most businesses accept credit cards, which are convenient for both the client and the business owner. While you may have to pay a small fee on each transaction, it is still worth accepting credit cards if you want your clients to be able to make payments quickly. You can also use third-party payment services like PayPal, Square, or myob credit card payment that do not charge any fees at all (but they will take a percentage of the transaction). Check or money order: These are usually sent via postal mail and require the client’s signature before they can be deposited in your bank account. Be sure that all checks are made out correctly so that there isn’t any confusion about who owns them. It’s also helpful if you include instructions on how long it takes for funds sent via check/money order before being processed into your account. This way there won’t be any awkwardness between parties later down the road when someone asks why there hasn’t been any progress on this matter yet. |
2. Automate the Process
Automate the process. If you have a client who consistently pays their bills late, create an automated reminder system that will send emails or text messages to your clients reminding them of upcoming payments.
Make sure these reminders are friendly, but also firm in tone. You want to be sure that your client understands that this is a serious matter and not something that can be ignored as a courtesy.
In addition to sending reminders about upcoming invoices and due dates, it’s also important for you to use an automated billing system that automatically sends invoices when work is completed and tracks payments for you.
This way, when one of your clients does decide to pay on time (or even early), there isn’t any extra paperwork for you or them, it’s all done automatically through the software program.
3. Set Expectations
It’s important to communicate the importance of paying on time, and explain that your business is a service and not a product.
Explain that you are providing a service to your clients, who in turn provide money in exchange for this service. Explain that while they may be happy with the work you’ve done, it wouldn’t be possible if you weren’t getting paid on time by them.
In addition to explaining these things up front during contract negotiations, send an email reminder when payment is due and then follow up via phone call or text once payment hasn’t been received within three days of the due date (or earlier).
4. Add a Late Fee
A late fee is not a new concept. In fact, it’s one of the most effective ways to encourage timely bill payments while discouraging clients from delaying payment.
Late fees can help you get paid faster and reduce your administrative expenses associated with collections efforts.
The key to setting a fair late fee is to make sure it’s reasonable compared to what other businesses charge for similar services in your area.
This will ensure that your business is competitive when it comes time for clients to make their next choice about who they’ll hire for these services.
5. Offer a Small Discount for Early Payments
You can offer a small discount for early payments. This helps to motivate clients to pay on time since they know you’re willing to reward them for paying early with some kind of reward.
You can offer a discount of 1% for each week that payment is made early, and this could add up quickly if your client pays in full immediately after receiving the invoice. For example:
When you were running your own business as a freelancer, you would offer three types of discounts on invoices: 1% off when paid within 7 days; 2% off when paid within 14 days; 3% off when paid within 21 days. If someone wants you to pay them right away (and they do), then they deserve something in return.
6. Reward Referrals
Another great way to get your clients to pay their bills on time is by rewarding them for referring you to other potential customers.
Referral programs are a great incentive for your existing customers because they know that they’ll receive something in return if they refer you to others. In other words, it’s a win-win situation.
You can offer an incentive like a discount or free service for any new clients that come from them referring someone else. This will encourage your current client base to share your business with others, which will increase the likelihood that those people will also pay their bills promptly.
7. Keep It Friendly but Also Firm
You should always keep it friendly but also firm. Your job is to get your clients to pay their bills on time and you need to be prepared for when they don’t. If a client isn’t able or willing to pay their bill by the due date, it may be time for some tough love.
If you think a client doesn’t have the ability or intent to pay their bills on time, you know they are going against one of your policies. That means that they are not following through with their end of the contract and therefore shouldn’t expect access to any other services from your company either.
You can close an account or give them a deadline if necessary, but no matter what action needs to be taken, do so firmly yet politely so as not to come off as rude or unprofessional, remember that this person is still one of your customers.
Conclusion
In the end, it’s important to remember that your clients are people and their needs are unique. While some of these methods may not work for your business or clientele, hope that at least one of these tips will help you get paid on time.
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