Late payments are without a doubt one of the most frustrating aspects of owning a business. A steady cash flow can be considered the lifeblood of any business. And the cash flow gives business owners the means to pay their employees and purchase the goods they sell. When businesses run out of money and times get lean, they open themselves to the risk of collapse.
For small business owners, an uncertain cash flow is one of the things that holds them back from reaching their full potential.
And one of the so-called culprits of the uncertain cash flow is late-paying customers. Implementing some billing practices will help you reduce the time before payments and maintain a steady and predictable cash flow.
1. Take into account the cloud. And while this may not come as news, cloud has managed to change the way the entire world does business. By leveraging it, you are able to improve nearly every aspect of your business.
With the emergence of the cloud, business owners have information at their fingertips. They are able to access the same documents they edit on their laptops or desktops from any mobile device. And, for example, if you were to receive a question regarding an invoice and need to put some last-minute touches on it, you are able to confirm information and send it in a matter of seconds. Nowadays, mobile-enabled interactions can help you solve some genuine problems for both businesses and customers.
2. Correctly invoice on time. By setting reminders and/or alerts you consolidate the process of consistently submission invoices on time. Also, consider setting up automatic and recurring invoices. By doing this you are able to save up some time that otherwise would be wasted performing redundant communication with your customers.
In addition, for recurring monthly bills, the customers of your company could even be able to set up automatic payments to the company, saving time not only for them but for the company as well and providing your business with faster payment.
3. Also, you could offer incentives for early payments. As a business owner you could make use of incentives to set in place desired customer habits such as paying invoices early. By encouraging your clients to use consumer apps that track rewards and offer extra incentives and discounts for the use and payment via a platform, you are able to reinforce its continued use.
Make sure to provide your clients with discounts or other incentives while also giving them a reason to act quickly and on time. In some cases, a small push is enough to convince someone to pay early.
4. Make sure that you have a detailed audit set up. You absolutely must keep track of your paperwork. The business is able to run smoothly when the organization stores its invoices, bills or other documents in one place (online). Setting up a detailed audit will also add some extra security not only for the business, but also for the customers. Chances are, at some point in time you may be required to show one of your customers that he or she hasn’t paid his/her last bill.
5. Maintain open lines of communication with your customers. Most often, people who have not paid didn’t do this because they do not want to pay; it’s just that they didn’t know they had not. To avoid such problems you could send an email that will act as a reminder, letting him/her know they forgot to pay. This simple gesture can go a long way as it will act like a gentle nudge, letting him/her know to get the payment on its way.
And the best news about all this is that such reminders can be automated by using cloud solutions. Also, by sending email reminders you reinforce the relationship you have with your customers while also providing you with an opportunity to engage them.
The email reminder should create room for open dialogue with your clients, while also offering them a sense of comfort and security.
Once customers are aware they can approach you and ask you questions, they will want to ensure they do it right and pay on time. Even more important, helpful customer service offers customers a great reason to stay with the company rather than jumping ships when times get tough.