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10 Tricks to Getting Invoices Paid On Time in 2020

FieldPulse | June 14, 2016

You landed the new client, you put in the work, you sent the invoice. Now you just sit back, pat yourself on the back, and wait to get paid, right?

Wrong, because the money never comes. 

Following the completion of the job, you hear nothing from the client. Unfortunately, this happens all too often in the service business industry. Sometimes customers legitimately forget and sometimes they just don’t make it a priority.

Late or missed payments are a disruptive and frustrating experience that most businesses struggle to deal with. You’ve got bills to pay and a business to run, which only becomes more difficult by the lack of cash flow you were counting on. So, how do you make sure you get paid by your clients on time

Here are our top 10 ways:

1.) Get it in Writing

Money can cause even the most honest people to twist arguments to their advantage. Make the payment total and due date very clear with a signed document whenever possible. This way, you can always reference the document’s payment terms. 

No confusion. No questions. No mess.

2.) Negotiate Invoice Payment Terms

We’re not referring to the missed payment, but instead the payment terms. If the client wants 30 days to pay and you want to give them 15, settle somewhere in-between. This makes the client feel like they’re part of the process, and once you settle on terms, it becomes crystal clear that both sides agreed to the payment terms. When the client does not hold to them, you can reference your negotiations and subsequent documents.

3.) On the Spot Mobile Invoicing Software

The best way to get paid quickly is to invoice the customer on the spot with an option to collect payment via cash, check, or credit card with mobile payments. Mobile invoicing software solutions like FieldPulse allow you to quickly generate a detailed, itemized invoice and send the invoice PDF to the customer immediately. It’s much easier to get paid in-person rather than waiting for the payment to come in from email or phone follow-ups.

4.) Consistent Invoicing

Do away with manual paper invoices and automate your invoicing for recurring jobs. If you establish a routine with your invoices (always sent on the 1st of the month for example), you tend to get more consistent payments. Businesses find it easier to plan their own finances when they know exactly when the next invoice is going to arrive and be due.

5.) Offer Discounts

Offer discounts or even rewards to clients who pay on time, or even early. Using the negotiation example from #3, how about allowing the terms to be 30 days, but a 5% discount if paid within 10-15 days? Or how about 5% off an invoice when a client pays on time for 6 months in a row? This encourages your clients to get a small financial benefit to pay on time. After all, if they decide not to pay on time, they’ll simply be leaving money on the table, and no business wants that!

6.) Offer More Ways to Pay

The goal here is to make it as easy as possible for the client to pay you. If a client hates writing checks, allow them to pay with PayPal or with a credit card. Any way you have the ability to accept to payment, try to let the client pay the way they find easiest. While you may pay 3-4% in fees, immediate payment is better than delayed payment or not getting paid altogether.

7.) Be a Gnat (Annoying)

Everyone hates gnats. Don’t be afraid to pester a client with follow-ups every now and then when necessary. Most often they just need a polite reminder. Sometimes, you’ll simply get paid because the client wants to stop receiving calls and emails from you!

8.) Charge Late Fees

Charge a late fee when the client comes past due, and hold to it. Ensure that the late payment is reasonable (you don’t want clients walking out the door), but enough to encourage the client to pay on time or risk incurring the late fee.

9.) Hold Work Hostage

If the client is past due and does not acknowledge your attempts to collect payment or seems like they simply don’t care and will get to it when they get to it, sometimes you need to establish that this is unacceptable. We specifically say “sometimes”, because this is fully dependent on the situation. If you have the ability to hold work, it can be a very effective way to show that they’re paying for work, and if they’re not paying, they’re not getting the work. It’s that simple.

10.) Resort to Legal Routes

Obviously an absolute last resort, but sometimes ultimately necessary. In most cases, you’ll be ruining a client relationship and burning a bridge by doing so. However, if the client simply refuses to pay despite receiving work from you, it can be a necessary evil. Don’t forget to write a letter first, stating further measures that will be taken if you do not receive payment. Give the client every opportunity to pay what is due.

How to Create an Invoice That Will Uplift your Business

By clearly defining the payment terms, including total amount and due dates, you can deliver invoices to your client that help continue a smooth business process. 

If you establish a healthy relationship and clear expectations up-front with your detailed invoices, clients almost always pay when they’re supposed to – it’s vital that you do everything you can to nurture the relationship before turning to other, more negative ways to force clients to pay. 

Now that you’ve freed up some time chasing your clients around for payment, you can focus on the nuts and bolts of your business moving forward!

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