Small business owners, consultants, and entrepreneurs can have great ideas, outstanding products or services, and an incredible work ethic. They can have a bright future and strategic plans. But if they are starting out or have a tiny staff, they may not always know the best business practices for invoicing their customers. These business owners know that they need to get paid as soon as possible to keep their companies on track and they don’t want their cash flow to slow down due to customers’ delays or errors.
Here are a few suggestions to keep in mind to ensure that you get paid:
- Enable customers to pay you in different ways
Some companies may be procrastinating on paying you simply because your method of payment isn’t their preferred way to process payments. Make sure that you are able to receive payments from online wire transfers, checks, credit cards, and cash. The more options you are able to offer, the better.
- Offer discounts for early payments and penalties for late payments
Some of your clients may be more inclined to pay promptly if they know they will be getting a discount of a few percentage points off their bill. Not all start-up business owners and entrepreneurs are aware that they are able to charge interest on overdue accounts.
- Hire professional collection agents
Many business owners find the process of collecting payment from clients a bit awkward. Chasing on clients and calling them about money isn’t always conducive to a positive business relationship. A professional collection agency can alleviate this burden so that your role is to continue to focus on making money while the collectors focus on collecting payments on your behalf.
- Get professional advice
Speak to a financial advisor who can give you a clear understanding of what your legal rights are and how you can go about getting what is owed to you.
- Create accurate and compelling invoices
Besides completing and issuing invoices promptly, you can also design invoices so that they stand out from the rest. Ensure that your invoice has the right information: your company name, address, phone number, contact person; your customer’s company name; all the relevant dates (the invoice date, the service delivery date, payment due date); the itemization of what the invoice covers; and the proper amount due.
- Hire a factoring company
When getting paid promptly is important to you and your business, consider working with a factoring company. They can ensure that a large portion of your invoices is paid upfront. Professional collection agents then follow up on your outstanding invoices and the remaining amount, minus a small factoring fee, will be paid to you when your customer pays. Factoring is an increasingly popular cash flow solution for business owners who don’t want to wait weeks and months to get paid.
Interstate Capital is one of North America’s largest and best-funded independently owned factoring companies. If you want to benefit from fast payments and our professional collection services, then get an instant factoring rate quote today.