There aren’t many facts we can agree with at face value, but the need for businesses to get paid in order to survive and thrive is definitely one of them.
This isn’t just because revenue rules the roost in the world of, well, in the world in general, but because getting paid faster means that you can concentrate on scaling your business, improving revenue and not wasting your most valuable commodity on chasing payments, by which we are referencing your time.
Whether you are a freelancer, a small business owner of the leader of a large corporate, getting paid on time is the not-so-secret of success.
Yet, for some reason, so many people still struggle with this side of handling finances, especially when it comes to streamlining their processes.
That is what we are going to address right now; getting paid faster without having to chase down debts.
Good work requires the right tools
The first rule of getting paid faster is going online. Not only will yourself money, you will reduce the amount of time it takes no end.
In this day and age, you haven’t really got an excuse anyway, there is just too much software to help and platforms that can address issues. There is quote-to-cash systems designed to make accounts receivable more automatic, systems like Due that specialize in online invoicing, time tracking and credit card payments, and the must-have tool that is Quickbooks, which is a full-service accounting platform that handles everything from invoicing to analysis. Which is right for you depends on your needs, but having the tools at your disposal is imperative.
Life is all about timing
If your system currently sees you dispatch your invoices on Sunday then you need to change this as soon as you can. You may think you are being smart because it will land on your client’s debt in time for a Monday payment, but it rarely works like that.
The best day for sending an invoice, according to statistics, is a Thursday. If you are sending out repeat invoices, then the matter of timing should be focussed on what you specify in your agreement. That means setting deadlines for payment and ensuring your client respects them by either incentivizing early payment or adding interest for anything that is overdue.
Just make sure your terms of payment are reasonable, by which we mean giving them two-weeks minimum and thirty days maximum. Of course, you can ask for payments to be made within ten days, which shouldn’t be a problem so long as you are respectful and professional when it comes to requesting this.
Don’t make it hard for them to pay
The easier you make it for them to pay you the quicker they will get on with it, something that will become more and more seamless as time goes on. To do this, you need to understand a few things. First of all, make sure you discuss your payment terms with your client beforehand, that way you will leave very little room for confusion when it comes to invoicing them.
That means confirming all the details of what you are charging for your services before you start any work.
Next up, the role of details. You want to make a detailed note of all your hours and billable expenses to clarify just what they are paying for.
And last but not least, keep them simple. These are invoices not works of art.