Chasing Payments, Clients?
7 effective techniques to take the chase out of your life
It’s a new day, and you’ve completed another project for one of your clients. You send them an invoice, confident that they’ll be just as happy with the work as you are. But then the waiting game begins – you’re constantly checking your email, waiting for that payment to come through. Does this sound familiar? For small and medium business entrepreneurs, chasing payments can quickly become a full-time job.
According to a Wall Street Journal’s research findings around 64 percent of small businesses own invoices that go unpaid for 60 days or more. Furthermore, 14 percent of small business brands disclosed that late payments are one of their biggest growth challenges. With rising inflation and the risk of looming recession in 2022, it won’t be surprising if collecting payments becomes harder.
So what can you do to avoid being caught on this web? In this blog post, we’ll discuss seven techniques that will take the chase out of your life and help you get paid on time, every time!
Technique #1 – Automate Payments
Another way to avoid chasing payments is to set up automatic payments with your clients. This means that they will authorize a payment to be made from their account to yours regularly. This can be in the form of splitting a 3 month program payment into 3 equal automatic deductions, or a subscription like weekly, monthly, or even per project. Automatic payments take the chase out of your life and help to ensure that you’re paid on time. The only caveat to consider: in most countries automatic payments can be processed only through credit cards, so make sure you factor in the cost of credit card processing in your program fees.
TinyWhale offers a range of prepaid, postpaid, split payment, periodic subscription choices for businesses to set up for their service.
Technique #2 – Set up a Payment Plan
One of the simplest techniques you can use to avoid chasing payments is to set up a payment plan with your client. This means that instead of waiting for one lump sum payment, you’ll receive smaller payments at regular intervals. Not only does this take the chase out of your life, but it also helps to ensure that you’re paid on time.
Technique #3 – Hire an expert to chase payments for you
If you’re tired of chasing payments, why not let someone else do it for you? There are now many companies that offer invoice financing, which means that they will pay you the full value of your invoice upfront and then chase the payment themselves. This can be a great option if you need money quickly and don’t want to deal with the hassle of chasing payments.
Technique #4 – Add Interest on Overdue Payments
If you’re tired of chasing late payments, one solution is to start charging interest on overdue invoices. By law, you can charge interest on any invoices that are more than 30 days old, so this is a great way to incentivize your clients to pay on time. Just be sure to include information about late fees in your invoice so that your clients are aware of them.
Technique #5 – Use an efficient payment service like Stripe or PayPal
Another way to avoid chasing payments is to use a service like PayPal or Stripe. These services allow you to set up automatic payments, which means that your clients will authorize a payment to be made from their account to yours regularly. Your clients will be happy that you made the payment process easy for them. Hence, it’s a win for you and a win for them, because while they enjoy the easy payment process, you get to receive payments quickly. Using an efficient payment gateway like PayPal will take the chase out of your life.
Technique #6 – Offer discount as an incentive
If you want to avoid chasing payments, one solution is to offer discounts for early payment. For example, you could offer a discount of two percent if the invoice is paid within seven days. This can be a great way to incentivize your clients to pay on time. However, ensure to include information about the discount in your invoice so that your clients are aware of it.
Technique #7 – Use a Collections Agency
The last technique we’ll discuss is using the service of a Collections Agency. If you’ve tried the other techniques and you’re still not getting paid, then it may be time to involve a Collections Agency. They will contact your client and try to collect the payment for you. This should only be used as a last resort, but it can also be effective in getting you paid.
Having to chase payments is one aspect of running a business that small and medium business owners agree is both frustrating and stressful. Many of them have even accepted it as a normal part of business life, but it isn’t.
By using the seven techniques detailed in this blog post, you can avoid chasing payments and get paid on time, every time. So put them into practice and see how they work for you. You’ll be glad you did. Thanks for reading!
Do you have any other tips for avoiding the chase? Share them in the comments below.