It’s no secret—getting your invoices paid faster is the surest way to increase your cash flow. And, as you may know, cash flow is as important as, or even more important than, your net profit.
The simple reason is that if you don’t have positive cash flow, your net profit is just a future promise. You need cash flow to run the daily operations of your business. In order to make sure you get it positive, you need good invoicing practices.
So let’s look at some surefire ways you can get your invoices paid faster today.
#1 Set concrete terms and conditions
One of the most important things you can do to get your invoices paid faster is even before you get a customer. That way is to set your terms and conditions (T&Cs).
It’s very simple: when you set your T&Cs, you are clarifying your and your client’s expectations. That is, if it is comprehensive enough.
Your T&Cs should include:
- whether you will take payment before or after you have completed the work
- how long will be allowed for payment
- the fee for late payment
- what kind of payments will be accepted
- how you will deliver the work
- whether you will deliver work before or after you get paid
When you set these clearly, your client will have no room for surprises or challenges. And that means—faster invoices.
#2 Get your invoicing organized
It’s true that you can do it all by yourself, but the best thing to do when it comes to finances is to get yourself organized and automate as much as possible.
Both of those are easily done with online invoicing software. You’ll be able to free your time up by doing your invoices on the cloud. That means no more looking for lost invoices, or client information, or going through your bank account for other details.
With everything on the cloud, you’ll be much more organized and streamlined.
#3 Set your strategic prices
When you set your prices, you should be very clear in how you’ve arrived at the figures.
Remember, your prices should be based on:
- your region
- your education
- your experience
- the amount of competition in your area
With that, you can look around at your competition and try to make more attractive prices or packaging. Also, you should always be flexible in your prices. That way, you may negotiate more work for slightly lower pay which means, overall, bigger invoices.
#4 Get paid faster by sending invoices out faster
This one is so simple, but it still needs to be said. If you send invoices out on time, you’ll be more likely to be paid on time.
This one is again helped out by using online invoicing software. Without invoicing software, you spend a lot of time looking for details, writing the professional email, and figuring out all the financial details.
Of course, with invoicing software all of that is done online, so you can even create and send out your invoices in just 60 seconds.
Once you have it done, send it out immediately. Your cash flow will thank you for it.
#5 Don’t let anyone slide
This last one is extremely important: stay on top of the late payers. If they don’t pay you on time, you should be on them the very next day.
In fact, some even recommend sending a payment reminder before the due date.
One important thing to do is to actually set your payment due date, not at the standard 30 days, but actually at 14 days. That way, even if the client is late in paying, you’ll still be paid faster than you would’ve the standard way.
So when it comes to day 13, send out a polite payment reminder. If you’ve received no money by day 15 or 16, send off another payment reminder, this time saying that payment is past due.
This should take care of it, but if it comes to day 21, send one off again. Maintain the politeness, but be more straightforward. This should take care of it.
With these invoicing tips, you’ll be sure to get paid faster than you normally would. Just remain consistent, and of course, automate as much as you can with online invoicing software.