We all know the frustration that we feel when we are waiting for a client to pay us. They are either on vacation, busy, you didn’t deliver your invoice during the current billing cycle, or they are simply late.
It can be frustrating to keep asking and following up with an email about your payment, and in the end, you are not a charity, you deserve every cent that you have worked for.
Me, being a freelancer myself, I’ve talked to my friends who are small business owners and have the same problem with clients not paying too.
To help, I`m going to share a couple of tips on how to make sure your clients pay you on time.
1. Add a Late Fee
If you want to punish someone, do it in their pocket. No one wants to pay more, so when making an agreement with your clients, make sure to let them know that you are charging a late fee for every invoice that is overdue.
You can say that you charge 5% for late payments more than 5 days, and 10% for payments that are due more than 15 days, and so on.
2. Be Organized
Today, we always run out of time. With having multiple projects and clients, personal obligations, sending invoices, checking if clients have paid us, and sending reminders for overdue invoices, it’s just too much to do and too much to remember.
It`s hard to be on top of everything, especially if you are juggling things all by yourself. However, invoicing is a very important task because we need a regular cash flow. How can we get paid if we don`t send invoices?
Thankfully, a good solution is to use online invoicing tools, like Sighted, that will help you stay organized and on top of your invoicing processes.
3. Follow-Up on Late Payments
If you work with big companies and they are your clients, there is a gap between payments that is usually happening during the holidays ─ because you guessed it – all of their financial sectors are on holiday.
Other times, there might be severe weather or a storm or big snowfall, and all the banks will be closed so your clients will not be able to send you the payment.
Of course, sometimes, it`s not just a decision of the client that they can`t or won`t pay you – it`s things that happen in everyday life, like a snowstorm.
Whenever the client is overdue by 3 days, that`s my minimum, send them a friendly email asking how they are doing along with a reminder that they are several days late with paying the invoice. Make sure that you are polite and talk like a friend.
4. Upfront or Half and Half Payments
As I said earlier, I have a friend who is a small business owner, and he told me that with clients that are new or with clients that he previously had issues with late payments, he started to ask for payment up front, or at least for 50%, with the rest due after the project is done.
This way, you will be sure that you will be paid, because no one wants to lose money. As I say, it’s win-win for both sides.
Final Thoughts with Sighted
There you have it. These are some tips that I gathered over time while working with clients and talking with my friends.
Remember, friendly follow-ups really work, and I`m sure you can find many other tips on how to encourage your clients to pay you on time, but the main goal is to stay friendly and professional.