Written by: Kristin Knapp, Digital Copywriter, Wave
When it comes to tracking your cash flow, timing is everything. You need to be able to predict when money is coming in and when it’s going out. That’s especially hard when your customers don’t pay on time, but there are ways to get paid faster and save time in the process.
Here are five tips to help you get paid faster and better manage your cash flow.
If you procrastinate on sending out your invoices, you’re messing with your cash flow. Easier said than done—the more customers you have the harder it is to manage your paperwork. One way to speed up the process is to use invoicing software with customizable templates so you don’t need to create each invoice from scratch.
Many people like the convenience of being able to pay with a credit card, and it can even speed up how quickly they pay. Think about it: If you get a bill in your email and you can just click a button to pay with your credit card, you’re more likely to get it done right then and there. If you have to go find your chequebook, write a cheque, get an envelope and find a stamp to mail it, you’re more likely to put it off. Offering different payment options is also a great way to make your customers happy. Data shows that customers paying by credit card pay an average of 17 days faster than customers paying by cheque!
If you have repeat customers who pay you for the same services on a regular basis, why not try subscription billing? It works for any business that has customers paying for a product or service on a regular schedule. Automate the process with software that has a recurring payments function, where you can schedule a payment once and it will automatically invoice your customer for future payments. You don’t have to remember to send the invoice and your customer doesn’t have to remember to pay on time. An added benefit is that you get predictable, recurring revenue that will help you stay on top of your cash flow.
Always make sure you set expectations clearly and fairly with your customers. While it’s great to agree verbally on payment timing, don’t neglect to include that information right on the invoice, and outline any penalties that will apply if the invoice isn’t paid on time. You’ll bypass a lot of misunderstandings and get paid faster by making your payment terms as clear as possible.
Sometimes people don’t pay on time and then you have to have an awkward conversation. You can cut back on the time and discomfort that comes from that situation by sending your customers payment reminders. If you’re using an invoicing tool, you can often automate that process, too, so it doesn’t become yet another task you have to do.
Learn more about automating your customer billing to save time and get paid faster.
Wave makes running a small business easier, with free online software and affordable financial services. More than 2.5 million businesses around the world use Wave for invoicing, accounting, credit card processing, payroll, receipt scanning, loans, lines of credit and more.