No one wants to get into a situation when they need to harass their clients to get them to pay up. It is embarrassing and uncomfortable to call a client to request payment. That is why it is necessary to do everything in your power to avoid making that call in the first place. Fortunately, there are ways to help make sure you are paid on time or even early.
The first step to assuring that you are paid is to make sure to ask for financial references from new clients. Although many deals are sealed with a handshake, unfortunately that is not enough to guarantee repayment. Do your homework and make sure that they have a reputation for paying their suppliers on time.
It is also essential that you ask each client to sign a professional contract agreeing to the specific payment terms that you have negotiated for every single project. Just because you didn’t have problems getting paid from them on the first or second project, doesn’t mean there won’t be issues or delays with future projects. The contract should spell out everything in detail, so that both parties are comfortable with the arrangement and well aware of when payment will be due.
One of the best ways to get paid faster is to ask for a deposit in advance or to make arrangements for partial payments prior to the project’s completion. You can create milestones for different stages and then ask the customer to break it down into smaller, more reasonable payments. That way you are not waiting to receive one lump sum after the project is finished, plus your client will have the benefit of breaking the expense down into smaller more manageable pieces.
Another way to increase your chances of getting paid faster is to send invoices directly to the client as soon as the project is finished. The sooner it is in their hands, the sooner it will be entered into their bookkeeping system, and the more likely it will be paid early. If you use an online invoicing system, it will be emailed directly to the client and you will receive a confirmation once they have opened it.
You can also improve your chances of early payment by sending a professional reminder notice before the due date. Every business owner is busy running their own company and sometimes it takes a little polite nudge to make them stop and put their signature on a check. You can even encourage them to pay it immediately, by offering a discount incentive for payment within 15 days.
You should also always follow-up with a letter thanking them for their business, so your clients know it is appreciated. This is a simple touch that will make your company stand out. It may not ensure that you will get paid faster next time, but it will be something they will appreciate and remember. Hopefully by following this advice, you will be busy sending thank you letters and not have to worry about making embarrassing calls asking for payment.
The article is posted by Gerwyn Wallto. You can find other related articles here.