2017-12-05 00:00:00InvoicingEnglishLearn why collecting on overdue accounts from customers and clients can increase cash flow and see ways in which you can effectively do it.https://quickbooks.intuit.com/ca/resources/ca_qrc/uploads/2017/12/Accountant-reviews-ways-to-track-unpaid-invoices-for-small-business.jpghttps://quickbooks.intuit.com/ca/resources/invoicing/tracking-small-business-unpaid-invoices/Enhance Cash Flow by Tracking Unpaid Invoices

Enhance Cash Flow by Tracking Unpaid Invoices

1 min read

Most businesses with significant amounts of clients or customers face late payments and uncollected accounts. Some businesses ignore these delinquencies or don’t prioritize them, and others focus on them on a regular basis. It’s a great practice to carefully track unpaid invoices and accounts on a monthly or quarterly basis, because it smooths cash flow and ultimately increases your net profits. Even if you can’t collect 100% of your overdue accounts, doing something is better than doing nothing.

Tracking unpaid invoices isn’t too time-consuming. After identifying a delinquent account, a very non-invasive way of addressing the problem is to write the client an email explaining that a payment is past due. Be sure to include a copy of the overdue invoice. If you don’t hear back from the client within a week, you should call the client and explain the situation. In either case, don’t just demand payment. Nicely explain that you understand that missed payments occur, and ask if there is anything you can do in the future to prevent it from happening again.

Most delinquent clients and customers will happily pay what they owe if you give them enough time. In the rare cases when a client becomes argumentative and refuses to pay, it’s best to chalk up the loss and kindly tell the client to seek the services you offer elsewhere. Collecting overdue accounts is a great way to increase cash flow each month, but if the collection process becomes too much of a burden for you or an employee, the opportunity cost in terms of wasted time might not be worth the effort.

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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