Few things are more frustrating than when customers don’t pay you in a timely manner. You just provided a product or service for them, and now they’re not holding up their end of the deal. Sometimes it’s laziness or oversight, but other times it’s not their fault, and something is preventing them from doing so. Here are some other tips for getting your customers to pay you punctually that’s easy for them and convenient for you.
Encourage customers or clients to use Deluxe eChecks. Instead of writing out paper checks and sending them via snail mail (which may be why it’s taking you so long to get paid, especially if your customer is located far away), ask them to send an online payment. They’re not like Electronic Funds Transfer or Automatic Clearing House, but actual emailable checks.
According to Deluxe’s website, using eChecks means “your online payment is delivered instantly to the recipient—all you need to send payment is their email address,” and it can all be done from a computer or mobile device. Your customers might be more comfortable with this route anyway because it saves them money on postage.
Currency Capital, a company specializing in streamlined loans, has created a hassle-free payment method that removes the need for communication between buyers and sellers. It also eliminates the burden of taxes, shipping, insurance, and so on. You can learn more about CurrencyPay on the website.
3) Automate reminders
Your customers are as busy as you are. Sometimes they don’t mean to let paying you slip their minds, but it happens. If you send them automated reminders, though, then their chances of forgetting greatly decrease. You can take advantage of a Customer Relationship Management System (CRM), which can automate reminders and emails, so none of your customers have a chance to say, “I wish you had reminded me, I completely spaced!”
4) Don’t charge late fees
That’s right, don’t. It’s tempting to think that if customers have to pay extra for being late, they will be extra motivated to pay on time to avoid it. However, according to FreshBooks, “If someone isn’t in a hurry to pay your bill, they probably won’t be in a hurry to pay your late fee, either. And a small penalty can just be written off as a cost of doing business and legitimizes the delay.” People procrastinate, but for some reason (that we’ve probably all experienced), people procrastinate harder when the consequences keep piling up.
5) Don’t give them forever
On a related note, people will procrastinate as much as they can when they are allowed to say, “Oh, this isn’t due for several months, I’ll get to it eventually.” No. Give them a reason to pay you as soon as possible. If there’s anything that throws a wrench in procrastination, it’s a deadline (even if you’re not going to charge a late fee).
6) Give them incentives
Some businesses have discovered a great way to get customers to pay not just on time, but early: discounts. Offer a small price reduction on your product or service if they pay the day of, or within whatever timeframe you set—or give them a discount on future business with you, so they are inclined to come back. People love discounts, so they’ll likely take advantage of it (and make sure you promote this, too, people will also be more keen on paying early if they’ve been planning on it since before your transaction was initiated).
7) Be patient
Besides being procrastinators, people can also be spiteful. Sending customers gentle reminders is a good way to co, but hounding them with phone calls, aggressive emails, and even threatening legal action is only for worst-case scenarios. Otherwise, people might put off paying you just as small vengeance for being too pushy. You have to trust them a little bit.
8) Strengthen your relationships
The supplier/customer dynamic should not be impersonal. As Instapage says, “Never forget that people like feeling special, which is why we’re suckers for ‘exclusive offers,’ and why our brains light up when we’re addressed by name.” People love being reminded that there is a person on the other end of a business, so when you have an actual friendship rather than a “Work is done? Okay, pay me now” attitude, they’ll pay you back faster out of appreciation.
9) Ask them their needs
American Express has a neat trick to include on invoices themselves: ask customers what they require on it, be it for their own records or simple clarity. It will take a moment to discuss up-front, but ask if they need a purchase order included, if a general price is sufficient or if they need a detailed ledger, who invoices should be sent directly to, etc.
10) Withhold rights
The Work at Home Wife suggests, “If possible, hold onto the rights to use and amend your work until payment has been received from the client” in the case of trading intellectual property. If you’re a graphic designer, for instance, only provide watermarked files until further notice. Find a way to withhold the final product, whatever it may be, until it’s paid for.
How do you get your customers to pay quickly?Opinions expressed here by Contributors are their own.