Handle Payments like a Pro

One of the biggest problems for small businesses and freelancers is that they often do not get paid on time. Debtors, late payers and defaulters always seem to be pilling up so much so that small businesses can even go out of business! But studies show that it does not take clients longer to pay because they are located geographically far from the service providers. The lateness of payment either depends on the faulty approach of the business owner or the difficulty in the payment mode. If you pay proper attention to these weaknesses and negotiate terms well, you will get paid faster and the time you waste waiting for a payment to arrive can be fruitfully invested in earning newer clients.

Sending estimates of the entire cost of the project before commencing the project or sending invoices of costs incurred at regular intervals even while the job is in progress can improve your chance of getting paid faster.

You are a professional. If you are to be taken seriously then your work should show it. But don’t just stop there. Take it a step further and make your invoices professional as well. Mention references or order numbers and other details.

Negotiate payment terms in case yours are different from your client’s ones. This must not be left to be taken care of when the moment of payment arrives.

Keep a checklist of which payments are made, which are pending, which are close to being lost causes and need to be taken care of legally.

If you are making phone calls to remind customers or clients about payment then keep a note of what at times you are making the calls because though you want to get paid you do not want to bug the life out of your clients by nagging them for the payment as this is sign of a bad businessman.

Set a time within which you expect to get paid. People always seem to react better to payments when they are given a fixed deadline like 3 weeks or 30 days.

Consider your deal before making it. Some jobs will inherently take longer to pay than others. If you cannot afford the time that is spent waiting for the payment or a regular cash flow is important to your business then it is best not to make the deal in the first place.

To do away with all these problems a simple solution will be to use an online invoicing service. Do not go by various myths that these services are not secure and too expensive. These services can actually make the payment process easier and faster as they provide better and more secure payment gateways to customers. In an age where communication has been made so much faster it is like a trip to the Stone Age to insist on a paper cheque as a payment mode or  waste time waiting for one to arrive.