Read more about How To
If you’re an entrepreneur, you’ve likely faced this problem many times. How have you handled it? And how do you ensure that it doesn’t happen so often that it negatively impacts your business? There are several steps you can take to reduce the frequency of late client payments. We discuss some of those steps below.
Accept Payments From Multiple Channels
Collecting payments from one or a couple of channels alone may cause your customers to hold up on paying you. This could be the case if your payment options don’t include the one(s) they prefer. Some clients will want to use direct deposits; others will go for online payments or bank cards. Do what you can to make payment easy for them.Send Invoices Quickly
If you don’t send out your invoices quickly enough, you may not get paid promptly. One reason will be that the lag between your client’s request for an invoice and its delivery eats into normal time spans for bill settlement. The other is that issuing invoices late may give the client an impression that you aren’t very keen on collecting payments early. They’re more likely to respond promptly if you bill faster.State Payment Terms In Your Invoice
A lack of clarity about payment terms may cause customers to drag their feet. They will have the excuse that you haven’t been clear on when they’re supposed to pay for the product or service you’ve provided them. Stating your terms of payment, including the time within which they should pay, can reduce the incidence of delayed payment.Sign up to the Connect Nigeria daily newsletter
Request For Upfront Deposit
You can ask your clients to pay a part of the full fee for your service before commencing work on it. This can help in at least two ways. First, it commits the client financially; if they pay the initial sum, it’s probably an indication that they’re willing to pay the remainder if you deliver the product or service to them. Upfront deposits can also keep your business cash flow positive.Offer Incentives For Early Payments
You may offer an incentive—for example, a small discount –for early payment. Even seemingly minuscule incentives can encourage otherwise lacklustre customers to pay on time. They would likely not want to miss out on a bargain.Send Reminders
Sometimes clients will fail to pay on time because they haven’t kept that bill at the top of their priority list. And if they aren’t actively considering their obligation to you, they’ll likely forget about it. Sending them a reminder (or periodic reminders) could get them to settle the bill earlier.Final Words
You don’t want your money trapped with a mountain of delayed payments. Follow the tips we have shared here to get more customers to pay earlier. Featured Image Source: CrelloGot a suggestion? Contact us: editor@connectnigeria.com
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