Turn on suggestions
Auto-suggest helps you quickly narrow down your search results by suggesting possible matches as you type.
Showing results for
Hello Community! Here we are, making moves into a new month. Of course you’ve heard about our Resource Center (and if you haven’t check, it out here). It’s filled with helpful information about running your business, QuickBooks, and everything in between. Today I want to talk about invoices and the not-so-great situation where they haven’t been paid by your customer (yet). There are an array of reasons why a customer would let their invoice go unpaid, but as a business owner you want to do everything in your power to limit this occurrence. Let’s start with some basics.
Before you give the invoice, know these two things:
Who should get the invoice? Sometimes it’s the client themselves, sometimes it’s the accounting department, or both. Make sure you know the procedure to expedite smoother, faster payment.
How do they prefer to pay? Offering your customers more payment options, such as credit card, eCheck, or direct ACH bank transfer, ensures that there’s no holdup for an easily avoidable reason.
If your customer prefers credit card payment and you’re asking for a paper check (or visa versa) you could be intentionally delaying that money getting to you. Taking the time to ask “Would you prefer to pay a different way?” can help you get your money on time.
On your invoice, be as clear and detailed as possible. It’s important for your client to see exactly what they are getting charged for and there’s no such thing as being too specific. What might you be missing? Here are some examples:·
- Consultation time
- Hours spent on specific tasks
- Research time
- Distinct project numbers for pre-defined deliverables
- Cost of materials
Payment terms and the due date should be located in an eye catching spot on your invoice. Haven’t established clear payments terms yet? Never too late to start! Common terms are “Net 15 or “Net 30”. This means the recipient must pay their invoicing with 15 or 30 days of the invoice date. Giving that flexibility to your customers is beneficial as long as everything is clearly outlined.
Even when everything is clear and you’ve done your part, past due invoices happen. It’s imperative to have a process for following up with your customer when this happens. One tip is to have a reminder letter. What should it include? Let’s take a look!
- The invoice number
- The date the invoice was issued
- The invoice due date
- The transaction payment terms
- The amount owed, including any late fees
- Instructions for payment
- Your phone number and contact information
Including all this information ensures they have everything they need to make the payments and also how to reach you if they are experiencing any issues.
Need templates or more resources? Head over to the full article for more: How to follow up on past due invoices: Guide and payment reminder letter templates.
