“Time will take your money, but money won’t buy time.” – James Taylor
If we could buy time, I’m pretty sure it would be a hot commodity. As much as I would love to roll back the clock, I do believe it is possible to manage time so well it practically makes you money.
Invoicing Tips
I’m not sure about you, but I hate begging people for money, especially money that I worked hard for and I’m legitimately owed. There will always be those late payers or clients that think they can justify not paying, but there are ways to reduce late payers and shut the traps of a client that wants to argue—with a lawyer—over a bill they need to pay.
1) Email invoices. This will easily reduce the time it takes for the client to receive the invoice and open it by at least a week.
2) Add a payment button to that email. Quickbooks Online and Xero both have this option. Imagine getting paid the same day you send out an invoice? Doesn’t always happen, but you are now providing that option.
3) Have a clear due date. Not “This payment is due thirty days from the date it was received.” People don’t do the math, and thirty days seems like a long time for people, so there is no urgency in their minds, even if you do have a thirty-day due date. For example, if you send an invoice out July 1st with the due date July 30th, it is now an invoice that has to be paid this month…instead of thirty days from now. Seeing a clear date will make payment more of a priority in a client’s mind.
4) Be accurate and transparent on your invoice. When you start tracking billable hours immediately after doing them, state that on the invoice with a small description of what was accomplished. This provides the client with more assurance of your billing (i.e., no opportunity for disagreements). Also, state fees incurred, but not “reams of paper and highlighters.” Basically, state those fees, but don’t nickel-and-dime your clients. Examples can be court filing fees, copy and printing fees, etc.
5) Have an enforce late payment penalties. There is nothing wrong with doing this. Smart businesses do this. Haveing a late payment penalty is also a great excuse to call up your client that is late on their bill and politely remind them about the late payment penalty. Just make sure you have this stated in the contract prior to the services you provide and also as a reminder on the invoice.
These items should help speed up your payment collection time. Not only will the client receive the invoice faster and have the option to submit payment faster, but this will also reduce any hesitation they may have.
Getting paid is quite frankly your bread and butter. You work too hard not to. I would take a good look at your processes and see where you may be able to make improvements. New habits take about two months to become automatic, so stick with it. It will be easier in the long run.
