Chasing Payments - any pointers?
Discussion
Just wondering if anyone has got any tips or a beginners guide for chasing payments?! I provide a mix of IT services to small businesses, sole traders and a few home users and just getting a bit fed-up with the length of time and number of reminder emails it's taking for some customers to pay up.
I should stress that It's not that these customers are dissatisfied in any way because even the jobs that I class as one-off's tend to yield more work. In fact, I think I've had far more repeat work than I was ever expecting. I would also add that a significant proportion of them are fairly affluent so it's highly unlikely they'll need to wait until pay-day to settle the bills!
I've tried to give people as many different ways to pay as possible although I don't yet have a mobile credit card terminal. The bottom line is I really don't like chasing payments and start to feel a little insulted when people don't pay up and then it becomes a distraction. I'm currently just sending people gentle reminders by email but I guess I should be sending by post or even on the phone too. We're not talking huge amounts - typically anything from £100 to £500, but it all adds up.
Any tips?
I should stress that It's not that these customers are dissatisfied in any way because even the jobs that I class as one-off's tend to yield more work. In fact, I think I've had far more repeat work than I was ever expecting. I would also add that a significant proportion of them are fairly affluent so it's highly unlikely they'll need to wait until pay-day to settle the bills!
I've tried to give people as many different ways to pay as possible although I don't yet have a mobile credit card terminal. The bottom line is I really don't like chasing payments and start to feel a little insulted when people don't pay up and then it becomes a distraction. I'm currently just sending people gentle reminders by email but I guess I should be sending by post or even on the phone too. We're not talking huge amounts - typically anything from £100 to £500, but it all adds up.
Any tips?
First of all make sure their are no disputes/issues with the sum invoiced/work done. Then set out a timetable/sequence of events and stick to it. Others will be along soon to tell you what to put in that sequence, though needless to say it starts with a polite reminder and ends going legal.
Bikerjon said:
Just wondering if anyone has got any tips or a beginners guide for chasing payments?! I provide a mix of IT services to small businesses, sole traders and a few home users and just getting a bit fed-up with the length of time and number of reminder emails it's taking for some customers to pay up.
I should stress that It's not that these customers are dissatisfied in any way because even the jobs that I class as one-off's tend to yield more work. In fact, I think I've had far more repeat work than I was ever expecting. I would also add that a significant proportion of them are fairly affluent so it's highly unlikely they'll need to wait until pay-day to settle the bills!
I've tried to give people as many different ways to pay as possible although I don't yet have a mobile credit card terminal. The bottom line is I really don't like chasing payments and start to feel a little insulted when people don't pay up and then it becomes a distraction. I'm currently just sending people gentle reminders by email but I guess I should be sending by post or even on the phone too. We're not talking huge amounts - typically anything from £100 to £500, but it all adds up.
Any tips?
If i was you, i think this is how our company does it, although you may need to do it differently.I should stress that It's not that these customers are dissatisfied in any way because even the jobs that I class as one-off's tend to yield more work. In fact, I think I've had far more repeat work than I was ever expecting. I would also add that a significant proportion of them are fairly affluent so it's highly unlikely they'll need to wait until pay-day to settle the bills!
I've tried to give people as many different ways to pay as possible although I don't yet have a mobile credit card terminal. The bottom line is I really don't like chasing payments and start to feel a little insulted when people don't pay up and then it becomes a distraction. I'm currently just sending people gentle reminders by email but I guess I should be sending by post or even on the phone too. We're not talking huge amounts - typically anything from £100 to £500, but it all adds up.
Any tips?
Make sure you get your job sheet signed off with the work detailed on it so there is no comeback from that way.
Send them an invoice, maybe you could do them all at the end of a month, that way you can keep track of them all.
Request payment within a set period, say 14 days, then make an 'official looking' letter saying final notice or court action, then issue CCJ proceedings for people who don't pay.
Have a look at Freshbooks. It's about £15 a month. I use it just for invoicing.
Auto emails reminders, which can get progressively sterner. My first one works well which includes, as a Small Business we are reliant on our clients paying their bills on time. Ultimately late payment puts availability of credit terms at risk.
I also like a lot that I can see when clients have viewed the invoice. Makes the 'I've not got it" interesting.
Final + for me is that clients - especially regular repeat ones like it - they can view their invoice history and pay direct through the application.
I don't work for them - just find it works!
Auto emails reminders, which can get progressively sterner. My first one works well which includes, as a Small Business we are reliant on our clients paying their bills on time. Ultimately late payment puts availability of credit terms at risk.
I also like a lot that I can see when clients have viewed the invoice. Makes the 'I've not got it" interesting.
Final + for me is that clients - especially regular repeat ones like it - they can view their invoice history and pay direct through the application.
I don't work for them - just find it works!
Remember the companies will have their own internal methods for hanging out as long as possible.
Some companies I've dealt with would always wait for a phone call before paying. I'd get payment immediately when I got around to making the call and not before. Very frustrating, but just part of doing business these days.
Some companies I've dealt with would always wait for a phone call before paying. I'd get payment immediately when I got around to making the call and not before. Very frustrating, but just part of doing business these days.
Bikerjon said:
Just wondering if anyone has got any tips or a beginners guide for chasing payments?! I provide a mix of IT services to small businesses, sole traders and a few home users and just getting a bit fed-up with the length of time and number of reminder emails it's taking for some customers to pay up.
I should stress that It's not that these customers are dissatisfied in any way because even the jobs that I class as one-off's tend to yield more work. In fact, I think I've had far more repeat work than I was ever expecting. I would also add that a significant proportion of them are fairly affluent so it's highly unlikely they'll need to wait until pay-day to settle the bills!
I've tried to give people as many different ways to pay as possible although I don't yet have a mobile credit card terminal. The bottom line is I really don't like chasing payments and start to feel a little insulted when people don't pay up and then it becomes a distraction. I'm currently just sending people gentle reminders by email but I guess I should be sending by post or even on the phone too. We're not talking huge amounts - typically anything from £100 to £500, but it all adds up.
Any tips?
Phone calls often work better than emails in our experience, if you can find the time to call them & politely remind them their invoice is due. If you don't have the time, it may be worth paying somebody for a few hours a month to do this for you?I should stress that It's not that these customers are dissatisfied in any way because even the jobs that I class as one-off's tend to yield more work. In fact, I think I've had far more repeat work than I was ever expecting. I would also add that a significant proportion of them are fairly affluent so it's highly unlikely they'll need to wait until pay-day to settle the bills!
I've tried to give people as many different ways to pay as possible although I don't yet have a mobile credit card terminal. The bottom line is I really don't like chasing payments and start to feel a little insulted when people don't pay up and then it becomes a distraction. I'm currently just sending people gentle reminders by email but I guess I should be sending by post or even on the phone too. We're not talking huge amounts - typically anything from £100 to £500, but it all adds up.
Any tips?
Even better, call them to discuss it and then tell them our'll be in the area tonight/tomorrow or at least within the next week and ask when you could pop by to pick up a cheque / payment.
Keep it personal and you should not loose anyone and maybe get repeat and recommendations.
I have in mine and it is really reaping benefits.
V.
Keep it personal and you should not loose anyone and maybe get repeat and recommendations.
I have in mine and it is really reaping benefits.
V.
I often have similar problems with customers (all b2b, no consumers) being slow to pay. Many are so disorganised that I have to resend copies of invoices. It's always the same ones, most pay on time, and I've always just tolerated it unless it's a big invoice. Telephone is the only way though, you pretty much have to shame/guilt them into paying.
I had one ring up last week to place a repeat order. "You'll need to pay your outstanding invoices from July and August 2012 before we'll accept any more orders". Still waiting for the cheque they promised a week ago though.
If I dealt with consumers, I'd insist on payment at the time of providing the service - do you invoice there and then or do you post/email it to them later?
The other thing to try is offering a prompt payment discount - e.g. "pay within 14 days and get 5% off" or similar. Obviously you'll have to inflate your prices to compensate.
I had one ring up last week to place a repeat order. "You'll need to pay your outstanding invoices from July and August 2012 before we'll accept any more orders". Still waiting for the cheque they promised a week ago though.
If I dealt with consumers, I'd insist on payment at the time of providing the service - do you invoice there and then or do you post/email it to them later?
The other thing to try is offering a prompt payment discount - e.g. "pay within 14 days and get 5% off" or similar. Obviously you'll have to inflate your prices to compensate.
Thanks for the suggestions. My works is a mix of B2B and B2C. The home users can be a nightmare to deal with but always pay straightaway. The businesses are far better to deal with until it comes to payment time!
I've been fairly lenient so far because with with IT work (repairs in particular) it's always nice just to give the customer a few days just so they can make sure everything is OK and working as they expect. The reality is that for repairs I need to take a much tougher stance because a computer shop wouldn't even hand over the machine until payment has been taken and yet there's me offering a door to door service as well!
For other work I tend to give 14 days payment terms. I quite like the sound of the Freshbooks approach of automated increasingly stern emails but I think a posted letter followed by a phone call may have more impact. I feel it's all too easy to fire off emails these days and many just get ignored or supposedly trapped by the spam filter.
I've been fairly lenient so far because with with IT work (repairs in particular) it's always nice just to give the customer a few days just so they can make sure everything is OK and working as they expect. The reality is that for repairs I need to take a much tougher stance because a computer shop wouldn't even hand over the machine until payment has been taken and yet there's me offering a door to door service as well!
For other work I tend to give 14 days payment terms. I quite like the sound of the Freshbooks approach of automated increasingly stern emails but I think a posted letter followed by a phone call may have more impact. I feel it's all too easy to fire off emails these days and many just get ignored or supposedly trapped by the spam filter.
Bikerjon said:
Thanks for the suggestions. My works is a mix of B2B and B2C. The home users can be a nightmare to deal with but always pay straightaway. The businesses are far better to deal with until it comes to payment time!
I've been fairly lenient so far because with with IT work (repairs in particular) it's always nice just to give the customer a few days just so they can make sure everything is OK and working as they expect. The reality is that for repairs I need to take a much tougher stance because a computer shop wouldn't even hand over the machine until payment has been taken and yet there's me offering a door to door service as well!
For other work I tend to give 14 days payment terms. I quite like the sound of the Freshbooks approach of automated increasingly stern emails but I think a posted letter followed by a phone call may have more impact. I feel it's all too easy to fire off emails these days and many just get ignored or supposedly trapped by the spam filter.
It can also do them through the post as well! For the cost I save the post approach until the end.I've been fairly lenient so far because with with IT work (repairs in particular) it's always nice just to give the customer a few days just so they can make sure everything is OK and working as they expect. The reality is that for repairs I need to take a much tougher stance because a computer shop wouldn't even hand over the machine until payment has been taken and yet there's me offering a door to door service as well!
For other work I tend to give 14 days payment terms. I quite like the sound of the Freshbooks approach of automated increasingly stern emails but I think a posted letter followed by a phone call may have more impact. I feel it's all too easy to fire off emails these days and many just get ignored or supposedly trapped by the spam filter.
For B2B stuff, don't forget the late payment legislation gives you a stick to use! Also, consider the carrot in early settlement discounts...
See www.payontime.co.uk
See www.payontime.co.uk
andye30m3 said:
The worse guy I'm have problems with just bought an apartment in Mayfair for those occasions when you can't make it home to Sussex but can't pay my £500 invoice.
Most annoying is when they say 'Can you send the invoice again please?' WTF happened to the first one, do they just throw them away?I hate this. I have a small stake in my fathers business and we were "talking shop" over a few Xmas Eve pints. He's very strict when it comes to payment and offices can't really go without water (which is what we supply) but he still has about 20 customers who owe the business for 3 months worth of invoices or more. Deliveries stop at this point and, lo & behold, the invoices are usually settled the day they are totally out of water.
I hate the culture of not paying on time, cash flow is important and if you are taking services on credit, you should be settling when the invoice is due. Lets face it, you don't pay your personal credit card bill late, do you, so why do FD's think it's fine to mess with small businesses cash flow?
I hate the culture of not paying on time, cash flow is important and if you are taking services on credit, you should be settling when the invoice is due. Lets face it, you don't pay your personal credit card bill late, do you, so why do FD's think it's fine to mess with small businesses cash flow?
My wife used to work in credit management for a major blue chip. They, and many others, have this department to gently and diplomatically chase debt. Its more complex than simply hassling people as they maintain good working relationships (vital for the next sale to the client) and negotiated debt paybacks where required.
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