Receiving timely payments boosts business growth as there will be enough funds for restocking and paying employees in time. Instances of late payment may adversely affect the business operation. Late payments also sky-crap the possibility of default payment which results in business losses.
Below are ways of making your customers pay faster.
Be clear on when you expect the payment to create a sense of urgency. For instance, if you anticipate the payment within 15 days, list this in the invoice. Additionally, if you impose charges for late payment, precisely state them. Give your clients enough information to ensure you are all working within the same framework. Do not mimic ghost language from big companies like using the phrase ‘net’ on the invoice. Use words that are simple to accommodate all customers to help them understand your payment terms. The rule of thumb states that your invoices should be clear and understandable as possible.
The sooner you invoice your clients, the faster you receive the payment! At times, the customers are very busy, and they may even forget if there is a payment that they should make. Prioritizing invoicing serve as a reminder that stimulate clients to make payments in time. Using polite language is imperative. Include words like “thank you” and “please” in your invoice.
This is a perfect way to enforce timely payments especially for large projects where you request the client to pay some amount at the onset of the project. This reduces the amount payable and elevates the likelihood of being paid faster for the remaining amount. This is helpful in improving your cash flow as well as training customers to make prior payments before work completion.
This may seem simple, but it works miracles. Sending your client a handwritten “Thank you” note makes them feel appreciated. A gift to celebrate mutual success is an excellent way of winning your customer’s trust. This is not bribing them, but it greases the payment wheels by letting them realize how much you appreciate them.
The way in which you interact with your customers determine how regular or timely they will pay you. Involving customers and heeding to their suggestions and advice helps establish a positive relationship. Typically, this is a fruitful way of getting closer to your clients which will undeniably give them a reason to honor your agreements to strengthen the relationship.
Adding a percentage fee on late payments encourages early payments. These additional costs affect the client’s bottom line which motivates a speedy turnaround. To avoid this, clients will always make an effort to pay in time.
Finally, sending payment reminders at regular intervals helps remind the customers of the deadlines. It is recommendable to be friendly and respectful enough when doing this not to break the bond. Discussing with customers regarding the importance of paying in time makes them feel cared for and valued.
About the Author
Morris Edwards is a content writer at CompanyRegistrationinSingapore.com.sg, he writes different topics like Which eCommerce Payment Gateway and Why?, Important Tips to Help You Keep Your Customers and all topics related to Doing Business in Singapore, if you are interested Setting up company in Singapore visit our website.
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