As a business owner, sole proprietor or freelancer, you have a lot to keep track of when running your business. Acquiring clients and customers usually comes first, and once you get a good customer base, you need to start getting paid to get the cash flowing. Customers who pay invoices become the lifeblood of your business model. This means you need a robust computer program that tracks invoices and makes online payments easy, especially if you have some invoices that fall beyond your deadline.
How to Track Unpaid Invoices Through Software
Most modern accounting software systems feature automated process that let you seamlessly track invoices. You just set up a time frame for sending friendly email reminders, and the system alerts you when someone views or pays an invoice. It also reminds you when payments come due soon. The most robust computer programs let you send invoices with just a few clicks, and they let you program when to send reminders to customers and when to receive alerts from overdue invoices.
Of course, you can always write an email or call someone if the invoice becomes a problem. However, keep your tone polite and friendly in every instance. Sometimes, a customer or client simply needs a gentle reminder to pay the invoice. In a worst-case scenario, you can send unpaid invoices to a collection agency or write them off as a bad debt on your taxes. You may not be able to get the full amount of the invoice, but some is better than none if the situation reaches this point.
Why Tracking Unpaid Invoices Matters
By tracking unpaid invoices matters in small business or freelance accounting, you have an opportunity to improve your business model and enhance customer service. You can send customers gentle reminders 10 days before the invoice comes due, the day it comes due and 10 days after its due date. When you offer varying payment methods, such as cheques, credit or debit cards, or payments directly from a bank, you improve your odds of collecting payment from a customer. If you have a new business or a startup, plan for unpaid invoices by setting aside extra money in your budget to alleviate any problems.
Setting up your accounting software for tracking invoices reduces a lot of the effort behind collecting the money customers owe you. QuickBooks Online helps you create and send smart invoices that help you get paid two times faster. Try it free today.