Frustrated by good clients or customers who don’t pay you on time? You don’t want to antagonize them, but you need your money. Chances are you’ve tried every trick you know, but you still have problems. So now what?

You’ve GOT to communicate! You absolutely must let your customers know your payment terms and the benefits they will receive by abiding by those terms. Note that I didn’t say penalties for not complying, I said benefits if they do comply. Here’s a few Success Tips on getting paid in YOUR timeframe!

CHECK CREDIT
It’s a pain, but you need to have a clear picture of your client’s credit history before you do business with them. This check should be made whether you’re doing business with individuals, small or large firms. If you think you don’t have to check the credit of the large firm, you’re making a big mistake. Large firms often tend to invoices with small amounts as ‘not being very important in the overall picture of things’, and this means you wait and wait for payment.

It used to be that to check the credit and payment history of a person or company you had to join your local credit bureau and subscribe to their credit services. This could be very expensive for the small business person dealing with just a few customers or clients. I’d suggest an Internet alternative to this traditional approach. Type the words ‘credit bureau’ into your search engine and look at the plethora of information you can obtain for very little money.

YOuR INVOICE
The first thing to do is get your invoices out on time! Sending out invoices on the 25th of the month is old hat for today. Things move too fast for this kind of tempo. Ten minutes after completing the work is not a ridiculous time. Prepare your invoice in advance, and drop it in the mail or hand it to your customer when you finish the job. It’s not impolite to ask for the money right then, in fact, you should prepare the customer for this when you take on the job! Collecting what is due you is good business … it’s not a customer imposition!

Second, print your payment terms right there in bold print on your invoice. All your company policies on credit, payment terms, pre-payment discounts, and penalties for late payments should be there in clear, understandable words. You can use an attorney if you wish, but the resulting legal language could mask the important information, and you don’t want that! Late payments may never be paid, but the fact that you have them on your invoice could cause some people to pay on time.

HANDLING THE ‘I DO IT MY WAY’ CUSTOMER
There are people out there who will ignore invoice due dates no matter what you do. They even ignore early payment discounts, and will sometimes take these discounts even though they pay 30, 60 or 90 days later. They have a fixed schedule for paying bills, and you will just have to wait for your invoice to be scheduled.

There are several things you can do with this customer. For example, when you discover their delay period you could send pre-completion invoices with the aim of entering their payment schedule so you get paid at about the correct time. Be sure you tell your customer about this billing option in advance. A second suggestion would be to add an additional amount in your future quotes for these recalcitrant customers to offset the cost of carrying their note for the delay.

WHEN EVERYTHING GOES WRONG
When you have a dispute with a customer, stop everything, call or make a visit to the site, and settle the problem … right now! If you’re wrong, admit it at once, accept all blame, don’t give a single excuse, and promise it will never happen again. Doing this will probably keep a valued customer, and will demonstrate your integrity. In fact, integrity is so rare that if you exhibit this trait you are liable to be the talk of the town and receive more business than you can possibly handle, it’s that rare a commodity.

If your customer is financially strapped, be nice, sympathize, listen to the tale of woe, but immediately draw up a note for the amount (with interest) and set mutually agreeable payment terms. Never, never, never let someone else dictate how you receive your money … it’s your money, and it’s your responsibility to make it possible for the client/customer to pay the amount due you. Yes, your invoice is legal, but it has been my experience that small invoice claims are often ignored or downgraded by overworked judges. A note is gold!