10 Tips to Avoid Not Getting Paid.

Statistics portray a sorry picture for small businesses or new startups, claiming that half of such businesses do not survive beyond five years, with the prime reason being cash flow problems.

Here are 10 simple ways to better manage money and avoid not getting paid by taking back control of cash flow.

1. Use a professional invoice format

Adopt a professional format for billing so customers see your “organized” side and respect you for that. Customers are likely to delay payments if your business appears disorganized. Professionalism demands respect and customers pick up on that and behave more professionally. Even implementing the use of an invoice template could make the process of sorting out payments a lot easier. This part of the business is very important, so you’ll want to make sure it is done in the right way. If you#re struggling knowing what a invoice should look like. You can download a basic invoice template pdf to your computer to customize.

2. Offer clear payment terms

A signed contract with clear payment terms will give customers confidence to work with you. Unclear terms only breed confusion. Besides, you may want to consider giving less time for payment. Be reasonable with payment terms for the agreed-upon services. However, some customers are still likely to stretch it out until the end.

3. Send invoices immediately

Send invoices as soon as the services have been discharged and are fresh in the customer’s mind. You may want to leverage mobile apps that send invoices immediately when the job is finished. This ensures timely payment for your services. What’s more, it’s a good idea to send the invoice when you’re with the customer, helping both of you clear doubts as you run through the final bill.

4. Send invoices electronically

Digital invoice formats are preferred to hand-written copies. Sending the invoice electronically will also ensure that customers do not need to face the hassle of scanning the same to add it to accounts payable. Update your invoicing system and do your customers a great service. What’s more, if customers have the option to make electronic payments, they are more likely to do so. This can be a win-win situation for both parties concerned, since this streamlined process can simplify the billing and save time.

5. Itemized invoices

Solve all queries related to accounting and invoicing by sending itemized invoices to customers, with clearly explained cost. This will save both of you time and ensure you do not have to face delayed payments all the time, since some customers tend to check invoices only in the last minute. Unclear invoices would make the task more difficult, while itemized ones, with each cost clearly explained, will facilitate the payment process.

6. Send automated email notifications

An automated system that sends email notifications reminding customers of pending payment can be a big asset. For difficult clients, you may want to send a halfway reminder along with a follow-up note a day in advance, so they can make timely payment before the due date.

7. Don’t abuse delayed payments

Customers must understand that you mean business when you send them reminders of overdue payments. It’s okay to charge an overdue fee for delayed payments. This will serve as a lesson for other clients that you are serious with timely payments.

8. Reward early payments

While delayed payments are penalized, it’s a good idea to reward clients making early payments. It may help to implement a system that deducts a percentage off the bill for early payments as a reward for the customer. This will encourage other customers to pay on time. By doing so, you can avoid not getting paid in time.

9. Remind over the phone

While a client may interpret an email payment reminder wrongly, a short phone call from your staff can get the client moving in the right direction. When it comes to remind customers about payment, let them know that you accept electronic payments via ACH (eCheck) and credit cards.

10. Get expert help

If cash flow is an area of big concern for your business, you may want to speak with a financial advisor. This is actually the right way to move forward when things do not seem that pretty at the financial front. An expert has the skills, knowledge, and updated information to help get your business back on track.

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10 Tips to Avoid Not Getting Paid.