You’re in business to make money, right? If your clients don’t pay on time, you could face serious cash flow problems. Late pay (or the horror of pay that never arrives at all) makes it challenging to pay your suppliers and employees on time, and it can even threaten the survival of your business. The solution? Get those invoices out quickly, and use these tested methods to get your clients to pay their invoices on or even before the due date.
Send Friendly Reminders
Sending friendly payment reminders to your clients doesn’t have to be a hassle. Set up your invoicing solution to send them out automatically. Depending on how well you know the clients, make friendly phone calls to confirm that they got your invoices and ask them if they’d like to pay while you’ve got them on the phone.
Customize payment reminders so that they’re in plain language. Avoid jargon your clients might not understand. The phrase “Net 15” is meaningless to many people. Instead, use a phrase like “due in 15 days” that anyone can understand. Include your phone number, email address, and even social networking contact information to make it easy for clients to get in touch with you where they’re most comfortable doing so.
Lastly, add polite phrases like “Thank you” and “We appreciate your business” to your payment reminders. A little courtesy goes a long way when encouraging your clients to pay on time.
Accept Multiple Forms of Payment
One of the most efficient ways to encourage clients to pay on time is to accept the varied forms of payment used in the UAE. Digital forms of money are usually the best because they transfer to your bank account instantly. Consider accepting credit cards, debit cards, and mobile wallets such as Emirates Digital Wallet, Samsung Pay, and Apple Pay. You might even accept cash, depending on the type of business you own and your typical invoice amounts.
Offer Incentives and Charge Late Fees
Few things excite clients like discounts. Consider offering a percentage off the invoiced amount as an incentive to get clients to pay early. Of course you shouldn’t offer discounts that cut into your profit margin, but even small percentages — 2 to 3 percent — encourage clients to make their payments quickly.
Charge late fees to encourage your customers to pay on time. Charging a flat late fee for smaller invoices or 1 to 2 percent of larger invoices per month is a proven way to encourage slow-paying clients to pay their bills on time.
Make Invoicing Easy
Cloud-based accounting software such as QuickBooks makes invoicing so easy and automatic that you don’t even have to put it on your to-do list. Send invoices on the go with no hassle so you can focus on your clients and projects rather than on paperwork.
Waiting for clients to pay their invoices can be nerve-wracking. Being persistent and contacting all of your clients throughout the invoice period is the best way to keep to a minimum those clients who have trouble paying their bills.